Successful parenting is not an easy task and is a challenging accomplishment that you need to do during the course of the life of your child.The best gift that you can give to your child is a bright education and in today’s time, the child’s security lies in financial planning. In the same context, you can avail a child education plan to secure your child’s future. This short post will discuss the some of the major benefits of a child education plan.
1) Maturity benefit for meeting college expenses
Who does not want to see his/her child taking professional courses and becoming an engineer, lawyer, or doctor? However, the cost of these courses is increasing day by day. If you are not ready to take care of the expenses, you may have to avail loan to offer support to your child. However, if you already start investing in a child education plan, then you would be left with enough corpus to meet the education expenses. Thus, every parent should avail a child education plan to help his son or daughter to opt for higher education.
2) Options to choose riders
Certain child education plan waive off the entire premium which is paid during the policy tenor if the insured person passes away. Similarly, riders such as personal accident insurance rider are beneficial if the individual buying the scheme is not alive anyone, or is severely injured.
3) Withdrawal to increase your child’s talent
If your child has some special talent such as acting, singing or instrument playing, you can let him/her prosper by making some partial withdrawals from the policy. What’s more, some specific plans come with time-based payments or pay-outs which will be eventful to meet the expenditures incurred while increasing the talent of your child further.
4) Helps gain support for the school fees of your ward
Even if the parent buying the child education plan is not around anymore, then the insurance company is entitled to pay around 10% of the assured sum immediately. The periodic and annual pay-outs amounting to 10% of the sum assured are paid each year until the culmination of the policy tenor. These pay-outs are enough to pay your ward’s school fees in your absence.
5) Tax benefits
When you avail a child education plan, you can get tax benefits easily. The payment that you make towards the child education plan premium is deductible under the Section 80C of the Income Tax Act. The maturity amount is exempt from tax, unlike equity shares or fixed deposits which entice a long-term capital gains tax.
6) Avoid loans
The most common way to arrange funds for the expensive higher education of your child is an education. You may be paying a loan already if you are a young parent. Why should you avail a higher degree of liability and repay a loan? It is the time when your savings that you started doing when your child is young will help you.
The Bottom Line
If you are a parent or a young child and want him/her to face no issues when it comes to his/her education, you should avail a child education plan.You can also compare many plans online and opt for a plan that offers riders and extended benefits matching your budget.No matter if you buy a child education plan online or offline, what matters is buying the child education plan to secure your child’s bright and safe future. All the best!