Keeping in mind the rising cost of education and the uncertainty involved in the funding process, it is not easy to meet them unless you have a proper plan in place. Various investments such as public provident fund, mutual funds, shares, gold, real estate etc. are self-funded in nature. One needs to be alive to keep investing in them to accumulate wealth. But, on death, the funding in all likelihood would stop and the goal may be jeopardised.
A better alternative, therefore, is the child insurance plan, which too is self-funded but in the absence of parents, the insurance company funds the policy. Yes, you read it right, its the insurer who chips in to ensure the child education needs are met at a time when required.
Buying an insurance plan in the name of child doesn’t make it a child insurance plan. A parent buys the child insurance plan which is structured in a way that it helps in meeting the education need of the child. Only a child insurance plan can ensure that funds as per the requirement and as and when required by the child can be accumulated. In the event of the insured parent’s death, the plan ensures that the desired sum is given to the child at the desired age, not earlier or later. Also, in the absence of the insured parent, the insurance company starts funding the policy. This ensures that the plan to save for child needs does not get derailed.
This story is from the August 2021 edition of Investors India.
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This story is from the August 2021 edition of Investors India.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
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