Why it is important to prepare for your child’s future now?

On 30th May 2012, both Priya and Pradeep were very excited to welcome their newborn son.

The birth of a child changed their way of living. The good news came in with a great sense of responsibility on their shoulders. Like every other parent, their child became a prime responsibility and their constant focus was in providing him with the best of everything. Facilitating every stage of their child and his goals required proper financial planning right from the time he entered this world.

Pradeep researched online about the right investment instrument so that he could build a good amount of corpus for his son’s future. He believed in saving for his son’s future as early as possible as it would help him accumulate enough finance.

Just like Pradeep, if your child is your utmost priority then you need a foolproof financial plan that will take care of your kid even during uncertainties.

Gradually, as your kid grows up, he or she will require a lot of money to pursue higher education and fulfill other needs. Growing inflation is one of the prime reasons behind the exponential growth in the cost of education and this is the reason why you need to be prepared to deal with these problems. With the current trend of inflation, assuming the cost of education for a professional course is Rs 10 Lakh today then after 15 to 20 years, it could go as high as Rs 45 lakh. Therefore, you need to make a good investment plan.

One of the options could be unit-linked insurance plans also known as ULIPs.

The new-age ULIP is an ideal investment plan for your long-term financial goals as it has a minimum lock-in period of 5 years. It provides you with the flexibility to invest in high-rated individual funds ranging from debt to equity funds. Edelweiss Tokio Life Wealth Plus lets you switch between these individual funds free of charge. It has no policy and administration charges. This means 100% of the premium amount is allocated to the fund value. It is the only plan where the company also invests with the policyholder in the form of additional allocations which increases at regular intervals. The additional allocation increases every 5 years for the first five years it is 1% p.a. of the premium paid, from the sixth to the tenth year it is 3% p.a., followed by 5% p.a. from the eleventh to the fifteenth year and lastly 7% p.a. from the sixteenth till the twentieth year. This magical touch to your investment helps your wealth accumulate and grow at a rate which can offer you good returns.

As a young parent, one of the main features that you can opt for is the rising star benefit where if in case an unfortunate event of death occurs to the policyholder then the nominee not only receives a lump sum amount but all the future premiums are invested in the fund value immediately. The other benefits of additional allocation and premium boosters will continue as it is. So, this is a financial shield that ensures your child’s dream still remains intact and unshaken.

If you are a responsible parent and wish to give your kid a bright future then make sure that you start planning for your finances at an early stage. Planning at an early stage will definitely guarantee a brighter future for your child.