The arrival of the little bundle of joy brings in so much happiness and it also means that you have an added responsibility and now you have entered the world of parenthood.
Right from the time you look into the eyes of the new-born, you will surely find a stirring of the new life. And looking into the eyes of the parent, we find a concern. Yes, you read it right!
The concern of giving the child the best possible future cannot be explained in words. Now, the priorities shifts and the thing what matters is the upbringing the child. As a parent, you make sure that your child intakes all nutritious food and has the best education. But have you ever given it a thought what if you are not around your child tomorrow? Who will take care of the financial security of the child?
The ideal gift that you can gift your child is the brightest future, which is possible when you start financial planning at an early age. Figure out the needs of the child right from the school education, college expenses, medical and marriage expenses.
In the times we are living today, raising a child is a difficult proposition. The biggest anxiety for any parent is providing quality education to the child.
To begin with, let us make an estimate wherein we assume when the child starts going to the college and likewise plan. The college education of the child in a reputed college or university can set you back by Rs 20 lakh or so. Well, this is the current expense, now you need to first estimate how much the education expense will be in the coming 15 years. Likewise, a wedding that would cost Rs 25 lakh, for now, would cost nearly up to Rs 70 lakh from 21 years of now at the assumed inflation of 5 per cent.
From the point of view of inflation, it is increasing each year and within the coming twenty years the education and various other expenses will be high. This is when the child insurance plan brings in the ray of hope for the parents as it enables the parents to invest in a way that they can meet up the expenses efficiently. With the right child insurance plan, you can secure the future of the child and ensure that every need of the child is met even when you are not around tomorrow.
Different insurance companies offer child plans in India. Some of the plans are the traditional plans wherein the investors’ premium is invested in the debt funds only and on the other hand, there are market-linked policies, which permit the policyholders to invest in debt and equities.
Every parent indeed wants the best for the child. But the rising inflation makes it a challenge. Having the child plan helps the parents to build the wealth corpus and fulfil the dreams of the child when they need the most. Before you zero down any child plan, it is important to take into consideration the events that will occur in the life of the apple of your eyes such as the education, sports, and so forth and accordingly make provisions for it.
The child plan also offers guaranteed payout and finances the education of the child and their hobbies and helps them to lead a comfortable life. This way every need of the child is surely taken care of even when the parent is not there tomorrow. Compared to any other traditional avenues such as fixed deposits or a PPF, a child plan offers greater returns. Choosing the right child plan is not an easy task. Listed below are some key factors that should be taken into consideration when buying the child plan:
The ambitions and goals of every child are different and unique. So it is prudent that the plans suit the goals and needs. Proper financial planning is another key to help the child to fulfil and follow the dreams. Let us now take a look at the key advantages of the child plan.
Listed below are the advantages of investing in the child plan:
Note: The tax benefit is subject to change in the tax laws.
The financial planning for the bright future of the child is a complex one. As a responsible parent, you should go with the right plan and give your child the wings to dream big and fly high.
You are the tree to your child that will protect and provide.