The stock market has emerged as an essential destination for investment. Many people in the new generation prefer to park their money in shares instead of banks. The biggest reason for this is that the returns in the stock market are much higher than the savings accounts or FDs of banks. However, sometimes people also face problems.
People Lack Information
For example, if you want to invest to secure your children’s future, many easy and popular options will be available in banks or post offices. Be it Sukanya Samriddhi Yojana or many FD-RD options, one can find the means of investment per the goal. In the case of the stock market, such specialized product is unavailable. However, you can easily invest in the stock market for your children. For this, you need to have information.
Demat Account Is Most Important
A Demat account is the most important investment in the stock market. If you open a Demat account for your child, all your problems end here. So we must see whether we can open a demat account for children. If it can be done, then what is its process?
Can Be Opened In This Way
A Demat account opened for children is called a minor Demat account. There is no minimum age limit for opening a minor demat account. No matter how small your child is, you can invest in shares because the facility to open a demat account is available. The thing to note here is that minor demat accounts cannot be opened like a joint account; instead, they must be opened with a parent or guardian.
Documents Required For Minor Demat Account
- PAN of parent or guardian.
- Address proof of parent or guardian. You can give an Aadhaar, passport, driver’s license, voter ID, etc.
- Child’s birth certificate. Bal Aadhaar, school transfer certificate or board mark sheet can also be used.
- The parent will have to complete the KYC process of SEBI. There should be no restrictions on them on the stock market.
- Bank account in the name of the child.
