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How to secure your child’s future?

As soon as you welcome your child in the family, you bring in a new set of roles and responsibilities in your life. These are no ordinary responsibilities and they are on you till your last breath. So, in this new and dynamic phase of life, you need to plan accordingly. Even though you should start planning as soon as your child is born or, in some cases even before they are born, it is never too late to start planning.

As the world is advancing every day, you also need to pace up with it. There are many ways to secure your child’s future and you should definitely know them to help protect your child from any uncertainties. Here are some ways that can guide you as to how to secure your child’s future even if you are not around to look after them anymore.

Make a plan for future

First things first, identify the amount of money you are planning to invest based on your child’s interest. Decide the amount you are willing to invest on your child’s education, extra-curricular activities, travel, etc., and then start investing.

Start early

It is said that early bird catches the worm and it is absolutely true when it comes to your child’s future plan. With early investment comes better benefit with minimum risks. Small amount of investment in the early years of a child can bring substantially large corpus. Just like investing in a term plan at an early age leads to minimal premiums and higher returns, child’s future plan works the same way. Late investment leads to higher premiums and low returns

Invest in child plan

Child plan for kids is just like pension plans for adults. Pension plans have secured the future of many adults for over decades. Even though a child’s future is considered safe and certain when parents are around, they could face a lot of trouble in their absence, be it emotionally or financially. To secure your child’s future in your absence, child’s future plan is a must. In case of parent’s untimely demise, child plan will ensure that your child receives the right financial support.

Types of child plan

There are different types of child plans available as per your requirement. You can choose the one best suited for your child and the one that is good on your pocket as well. Following are different types of child plan:

Child Insurance Plan

They come with both insurance and investment elements. A child insurance plan provides a security net for your child even if unfortunately something happens to you and you are not around. Child insurance plan is further divided into two categories:

  • Regular premium plan
  • Single premium plan

Unit linked child plans (ULIPS)

These come with great returns some advantages are as follows:

  • Flexibility of withdrawal alternatives
  • High returns
  • Appreciation of value with time

Money back plans

They cater to individuals need for future expenses. They come with efficient planning alternatives and can be used as child’s future plan.

Endowment plans

It works both as insurance as well investment plan as you are guaranteed an amount at the end of endowment period. This makes an excellent saving tool for your child’s future.

Benefits of child plan:

There are several benefits in buying a child’s future plan and they are as follows:

  • Provision of school fees
  • Funding the child’s interest
  • Wedding expenses
  • Higher education
  • Meeting the unstable market

Sukanya Samriddhi Yojna

Sukanya Samriddhi Yojna (SSY) is a savings scheme launched by our Prime Minister Narendra Modi Under the campaign Beti Bachao Beti Padhao. The intent is to secure the financial future of the girl child. If you are blessed with a girl child then this plan can also be very fruitful as it offers aan interest rate of 7.6%, compounded annually. Some major advantages offered under Sukanya Samriddhi Yojna are:

  • It has tenure of 21 years or until the girl child is married after the age of 18.
  • Offers a high rate of 7.6% interest compounded annually.
  • Offers the benefit to transfer the account.
  • Tax benefits can be availed as an EEE (exempt, exempt, exempt) form.

So to conclude, as plants need proper nourishment and care at their early stage in life so that they could turn into a fruitful tree in the future, so are the kids. A proper planning and security of your child’s future will not just benefit him but also help you lead a peaceful life ahead. A healthy present of your child will lead to a secured future. Choose wisely!

Written By: PolicyBazaar - Updated: 26 May 2021
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Disclaimer: Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by an insurer.
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