Simplified Laws Guide to Taxation and Legal Concern “How quickly she has grown! I still remember seeing her as an 8-month-old baby! She was not even one foot long, now I have to look up to talk to her! Time flies”. This is how the parents react when their child turns 18 years old, am I right? (In these many years, the parents forgot that they are also ageing)
Ageing brings responsibilities, and this is true for children too! The parents will also anticipate to see whether their adult son or daughter can become a tax-saving instrument!!!! Today, one of my nieces’, Nidhi, turned 18, prompting me to dedicate this short note to her.
Learn signature – In today’s digital age, it’s still important to have a unique signature for official documents. Encourage your child to practice a signature they can use for years to come, adapting it as they grow older.
Obtain PAN Card – This is a passport for travelling in the world of finance. See the excitement on the face of your child when they receive the PAN card, an important milestone in their financial journey! (not joking, experience the happiness in little things)
Open a Bank and Demat Account – Visiting the bank to open their first savings and Demat account can be a memorable experience for your child, one they’ll remember for years to come (The memory may be good/bad depending on how the relationship manager treats her).
Change the Customer ID If your child already has a bank account from their minor years, it’s time to update their customer ID and provide separate contact details. The parents no longer are the guardians of the account.
Obtain Voter ID, Driving License – Help your child acquire essential documents like a voter’s ID and driver’s license. It’s important for their civic engagement and personal mobility. Don’t forget to update their Aadhar card and passport validity as well.
Financial literacy – As a stream of learning, the knowledge of finance is imparted to commerce studies. Science/arts students are deprived of financial knowledge in the school curriculum. So, teach the child the basics of finance and money management, empowering them to make informed decisions about their financial future. The more and sooner they know about finance the better it is for their life.
Lastly, consider financial gifts – You can consider gifting your child some savings in the form of fixed deposits or mutual funds. Any income earned from these investments will be taxed in their hands only, potentially reducing the overall tax burden for your family.
So, your child is gifting some savings straight away upon turning 18 years old!
Discuss responsibilities – Turning 18 comes with newfound responsibilities. Have open discussions with your child about managing their finances, making responsible choices, and planning for the future.
Celebrate the milestone – Finally, take a moment to celebrate this significant milestone in your child’s life. Have a heartfelt conversation, and acknowledge their transition to adulthood with love and support.
