Child Insurance Plan: If you want to take a child insurance plan for the safe future of your children, then you have to avoid making some common mistakes. Many parents invest in child insurance or child investment plans with the intention of providing good higher education to their children, but due to some mistakes, they get low returns. In today’s time, from school education to professional degree, big funds are needed, so if you plan 10-15 years in advance, then you will be able to collect good funds.
avoid taking too much risk
The policy holder should keep in mind how much risk he is capable of taking. The higher the risk, the higher the return – this is true, but before investing all your hard earned money without understanding the plan, you should understand your risk taking ability. Experts suggest that one should invest only for long-term investments and proceed with a moderate level of risk.
count inflation rate
It makes sense to add inflation rate to the cost of your children’s education after 5 or 10 years from now. Suppose, in today’s time the fee of a course is 10 lakh rupees, but after the coming 10 or 15 years, the price of this 10 lakh will increase at the rate of 5 percent per annum, so according to this, at the time of your child’s studies, you will have to pay Rs. Today’s 10 lakhs will cost 21.07 lakhs. Therefore, parents should pay special attention to the inflation rate while investing.
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Get your insurance done first
Before taking a child insurance plan, parents should take their own insurance. If you die, the death benefit from the insurance will provide financial assistance to the entire family. Taking your own insurance helps your family a lot in times of crisis. Remember, buying insurance for yourself can support the entire family, only then should one invest in a child insurance plan.
Keep in mind the policy term
It is very important to match your child’s future needs and the term of the policy. If you want to collect funds for higher education after 15 years, then choosing a policy term of less than or more than 15 years will not help.
Don’t delay in investing
Delaying investment is the most common mistake. The more you delay in investing, the lower will be your return. One should start investing for the child as soon as it is born. Suppose, if you invest Rs 10,000 every month from the birth of the child and you get a return of 15%, then by the time your child is 20 years old, he will easily get a corpus of Rs 1.33 crore.
Tags:, Child Care, Child Rights, Insurance, Insurance Policy
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