The government has announced a new scheme – NPS Vatsalya in Budget 2024 (July) This is for investment by parents/guardians for their children (minors).
The parents can contribute to the account till the child is a minor. Post that once the minor child reaches the adult age (of 18 years(, the account can be seamlessly converted into a normal NPS account.
It may be too early to comment but in my view, this new instrument can be safely ignored by the parents for now (unless they are super rich). Parents must first concentrate on planning for their own retirement and then on their children’s retirement after decades. Also, they should first focus on saving more for children’s education than planning for children’s retirement!