Most of us leave no stone unturned to ensure our child’s well being. However, we ignore a critical aspect of the same — planning for eventualities. The best way to make sure that your child is protected against all eventualities is to identify and plan to protect him through each of his life stages.
If we analyse, in the growing years of a child, education definitely emerges as the most critical aspect.
However, there are a lot of other activities which are a part of child’s lifestyle and play a critical role in shaping his/her personality and future. Holistic protection, therefore, would mean protecting not just the education aspect of the child’s life but also the lifestyle.
Many parents start saving in form of various financial instruments to accumulate the corpus that may later be used to facilitate higher education for their children. The ever increasing cost of education, however, may render these savings insufficient to meet the actual cost of the child’s education. However, there are a slew of financial instruments available in the market such as mutual funds, fixed deposits, insurance products, which can help parents address this concern. While investment in instruments such as mutual funds and fixed deposits can also help accumulate the required corpus, investment in a comprehensive education insurance plan will ensure that the finances are available whenever the child needs them, irrespective of the parent being around or not.
EDUCATION COSTS
Education, though critical, is only one part of the child’s life stage. Parents need to make sure that in the event of the demise of the bread earner of the family, the child or his/her lifestyle doesn’t go through any financial stress.
Parents can see to this by insuring their lives with an appropriate term plan cover. Both the parents, if working, should go for this investment with a cover of at least 10 times their respective annual income. Although this may be a cover for the parent’s life, it would also act as protection for the child.
Hence, long term investment concerns such as education and protection can be best addressed through insurance. Parents must invest in a pure term plan as early in life as possible to ensure the child’s protection and a comprehensive education insurance plan must follow. This supplemented by conventional saving and investment tools will provide protection for the child’s life.
(The writer is Director-Marketing, Aviva India.)
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