I have start saving for my kids education. He is 4 years old. What i can do ? Mutual funds or some other instrument?

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I would suggest you to invest in diversified Mutual funds

Would also suggest you to take term insurance Incase of exigencies

Choose a balanced fund or debt fund if you want your principle to be safe. Otherwise invest as SIP in index fund.

Kid is 4 years old, Wont I be loosing on good returns if i invest in Debt fund now?

I highly recommend PPF. By the time they are 18, you'll have a huge compounded corpus.
The interest gained from this will become tax free source of income that can actually take care of the education.

If we want can we remain invested in PPF even after 15 years ?

Mutual fund is the way to go.

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