In today’s competitive World, dreaming big and fulfilling children’s educational aspirations is one of the foremost financial goals of parents. These dreams are not just confined to availing quality education from premier institutes in the country, but also availing a great education from foreign universities as well.
Parents recognize the importance of a quality degree to establish child’s career. The reason why parents are able to dream big is the presence of various children education plans in the market, offered by top insurers in India.
Insurers are providing parents with an avenue to invest in children’s education plans by paying premiums and receiving an amount on maturity of the plan or at certain milestones. Some of these children’s education plans are linked to the markets (Unit-Linked Plans), which help aggressive investors get above-average returns.
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Here are some tips to help you get started and put you on the right track:
Prepare a Roadmap: Preparing and planning for child education is a fairly new concept in India. Most parents do not plan for their children’s higher education, whereas every parent has the aspiration of providing quality education to children. These dreams cannot be fulfilled without strong financial planning. To make these dreams a reality, start realizing financial goals.
Once you lock-on to financial goals, it is not very difficult to achieve them. The first step is to prepare a roadmap. By this we mean, planning for the future by considering certain important parameters like amount required for child’s education, an estimate on education costs in the future, setting a date by which you can achieve your targets, expected maturity amount and so on. Once you list down all important points and know your child’s goals and aspirations, attempt to fulfill them.
Don’t Ignore Inflation: Inflation is one of the most crucial factors that affect future financial goals. Do not ignore the impact of inflation on education. Availing quality education is already expensive and to top it all, education costs are rising. An amount that you might think adequate today, may seem insufficient in the future.
Ignoring inflation may lead to either spending a part of your retirement corpus or availing an expensive education loan. To avoid this, try and start saving as early as possible. Long-term planning helps avail child education plans at lower premium.
Select the Tool Carefully: To reach your financial goals and maximize returns within the given timeframe, it’s very important to select the right investment tool. If you are a risk-averse investor, then you can select any safe investment option like PPF or fixed deposits. However, if you are ready to bear risk then you can invest in mutual funds. These are an excellent long-term investment.
Protect Your Goals: Secure your child’s future and keep child’s education plans on track by securing your family with a term life insurance plan. The sum assured must be enough to stabilize family finances as well as fund child’s education in your absence.
See Also: 10 Rules For Planning Your Childs Future
If you are not good with finances, take the help of a financial advisor to achieve goals. Make sure to appoint a nominee, like your spouse to receive the death benefits. Make a WILL and clearly state where your money is going. In this way you will be able to secure your child’s future and help him/her realize career dreams.
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