Bringing a new life into the world comes with its set of responsibilities. It also includes financial liabilities, and the planning requires to secure your child’s future. Hence, as a parent, you need to plan and take everything into consideration in advance.
By opting for the best child plan in India, lets you cover several aspects. These child policies in India allows you to take care of the various stages of a child’s life. This includes their education, healthcare, and even marriage.
In this article, we will try to understand why a child investment plan is essential and the benefits which it offers.
Perhaps one of the aspect of your child’s life, which requires more investment than the others is education. The child insurance plans offer you financial support for your child’s higher education. So, when you pick a plan, make an estimate of when will your child go to college or what kind of college do you want to prepare your child for. Once, you have a sketch-able idea about these factors, buy the best child education plan which fits the bill.
Financial preparation for your child’s wedding commences now too. Generally, Indian weddings cost up to Rs 25 lakhs today. They would cost approximately Rs. 70 lakhs 21 years later. While doing this calculation, it is essential to assume an inflation of 5%.
Generally, child insurance plans are investment-cum-insurance plans and are similar to the ULIP Plans offered by insurance companies. However, in these plans, parents need to invest in the best child insurance plan since the birth of their child. It is advised that you commence the investment within 60 to 90 days of your child’s birth. This allows you a good time window to accumulate more substantial sums for your child’s future. The compounding effect helps to create a significant financial corpus over the period of time.
If your child insurance plan is a ULIP-based plan, then it offers a waiver of premium. Here, the insurance companies take care of future premiums in case of the sudden demise of a premium-paying parent of the child.
This allows the finances to keep growing. It also decreases the possibility of the child falling short of funds at the time of the maturity of the policy. The basic plan may not offer you this advantage. Hence it is crucial that you invest in a child insurance plan which provides more extensive protection to your child.