Corporate bonds in India, even secured ones, carry a risk of default and periodic rating downgrades, which can negatively impact returns. Investors take on higher risks by buying bonds with lower credit ratings to aim for high returns. Further, India has no tax-free corporate bonds – interest is fully taxable. Equity index funds, despite volatility, can potentially give high inflation-adjusted returns over the long term.

Per Indian tax laws, corporate bond interest is fully taxable. While government bonds are tax-free, their returns are lower. Ultra-safe bonds cannot beat inflation. The notions of minimizing risk, tax-free income, and high real returns are incompatible. Other options like the Public Provident Fund, Sukanya Samriddhi Yojana, and Senior Citizen Savings Scheme offer sovereign guarantees with tax benefits, but returns may be below inflation.

Be cautious of fancy terms like “secured” or “inflation-protected” by new age bond platforms. Read the offer document to evaluate the legal safeguards. Avoid exotic instruments with unclear risk-return tradeoffs. One can grow an education corpus through disciplined investing without chasing hypothetical tax-free high return options.

Start early and maximize 80C, PPF, NPS, ELSS, ULIPs for education needs. Invest heavily in diversified equity funds instead of corporate bonds for growth. Have a balanced portfolio as the goal nears. Do not expect guaranteed high tax-free returns from a single instrument. Take a holistic approach to meet education funding goals.