Child Plan: A head start for your child

Once you become a parent, your primary concern is providing your child with the best of what you can. Financial independence is one of them too. However, while investing for your child, you must ensure that they address multiple goals. These goals could be for both – you and your child.

Child plan features are designed in a way to help your child with finances and you with tax savings. Creating a financial corpus is a by-product of it. In this article, we will take a look at what are child plans and how will this investment help your child in future.

What are child plans?

Child plans or child investment plans as the name suggests are a financial investment which you make for your child’s future. This investment comes handy when you need to need funds for school days, college days, further education, medical needs, and other needs as and when they come up.

What should you expect from child investment plans?

  • While there are a plethora of child investment plans in the market, you need to select the right one for your child. Here are some of the things which your child plan should provide.
  • More returns in its tenure that what your child needs. This surplus return will help you deal with financial fluctuations in the market and secure money for your child’s future.
  • Another crucial feature which you should look at is the tax benefit. Not all child investment plans come with a tax benefit; hence, it is important that you choose the one which does.
  • While you may hire an agent to make your investments, it is essential to check if they are investing in equity or debt. Here, your risk-appetite plays a crucial role.
  • Check if ULIP fits adequately. ULIP is one of the best and safe investments which can take care of some of your child’s needs. It is known to offer basic life cover and wealth growth.

What are the benefits of child investment plan?

Once you tick all the boxes as mentioned above, child investment plan offers you tons of benefits. Some of them are:

Automatic allocation of funds:

Once you pay your monthly or timely premiums, your finances are invested in instruments which are best suited for your profile. Thus, this eliminates the hassle allocating funds of fund allocation. It will automate in a way to offer you the best of returns on your investment in the long run.

Helps you meet your child’s goals:

With or without you. To say the least, when you choose ULIP, you grow your money as well as you are safe from any contingency. Primarily, your sudden demise. The child investment plan will take care of your child’s future and financial support, even when you are not around and help him/her, fulfil their dreams.

Your child will get a timely pay-out or a lump sum amount in case you meet with an unfortunate event.

Helps you grow your finances:

One of the best parts of child investment plans is that you can couple this plan with other instruments such as ULIP. This investment is known for its high returns and safety. As soon as your plan matures, you get more monetary benefits. And, you can always use some extra cash to take care of your child’s needs and wants.

Helps you plan your child’s goals better:

When it comes to your child’s financial future, it’s best not to delay any investments. In the financial world, time is of the essence and every second passed is a penny lost. Hence, the sooner you invest in a child investment plan, you can pay less premium and save yourself from the risk of inflation.

With these points, we can positively conclude that child investment plan, in many ways, is truly a head start for your child.