For a child who is a minor, mutual funds offer two options of investing. You can make an account in the child’s name and transfer money to their account, or you could directly make the investment from your own account. Some schemes / funds have a minimum lock in period of 3 years or till the child attains the age of 18, which ever is later. This way the money grows for a longer time and is useful when the child actually needs it. Mutual funds also offer some children’s funds- typically balanced funds that are a combination of bonds and stocks that mature when the child turns 18.