Disclaimer
: In Unit Linked Policies, the investment Risk in the investment portfolio is borne by the policyholder.
Written by
Abhishek Chakravarti
BFSI Writer
Abhishek is a financial writer with over 6 years of experience in the BFSI sector. Prior to his current stint with Axis Max Life Insurance, he has worked with leading fintech startups. He specializes in writing about taxation and various investment products like ULIPs, retirement plans, guaranteed investment plans, mutual funds etc.
Reviewed by
Sahil Rawal
BFSI Expert
Sahil Rawal is a digital & brand management specialist with over 10 years of experience in Financial Services Industry. Life insurance professional with expertise in digital marketing strategy, website content marketing and brand communication designed to increase brand awareness, drive engagement & sales.
To fund your child’s higher education, you need a robust plan that can guard against the rising inflation. Moreover, a good way to do so is by purchasing a great ULIP child plan in India that offers adequate features of investment as well as insurance in a single-vehicle. Here’s how it can help take care of your child’s higher education or other goals:
Any career that your child selects, be it a known stream (architect, lawyer, doctor or engineer) or a unique one (data scientist, marine biologist, artificial intelligence and so on), the adequate ULIP child plan in India will help meet the education expenses. All you need to do is start investing in such a plan at an early age, and allow your portfolio to grow and gather a huge amount at the time of maturity. This amount will not only take care of the higher education needs of your child but can also be used to meet goals like your child’s marriage or to set up his business.
In case of your demise, generally the insurance company pays a certain percentage of the sum assured immediately, and periodic annual payouts are paid each year until the end of the policy tenure. These payouts help take care of your child's school fees in your absence.
Child plans not just cater to higher education expenses. These plans also offer partial withdrawal options to take care of your child’s talents too. If your child possesses a unique talent (instrument playing or singing) or needs funds for enhancing his skills (like learning a new programming language), you can nurture the same by making partial withdrawals from your child insurance plan.
Life Cover: The life cover that comes with the insurance protection part of the child plan, can be opted depending on your financial capabilities and needs.
Waiver of Premium: Upon the demise of the policyholder, the nominee gets a lump sum benefit, but the policy does not end. There is a waiver of the future premiums, and the insurers continue investing the money on behalf of the policyholder.
Tax Benefits: Child insurance plans offer not only returns and protection but also tax exemption under section 80C (life insurance) and section 80D (critical illness riders).
Child insurance plans offer a wide range of fund options that you can invest in. You can categorize these funds into low-risk funds, medium-risk funds, and high-risk funds.
If you are investing for the long-term and need aggressive returns, taking exposure to equity is an excellent option to get some decent returns. While debt is safe, when it comes to beating the surging inflation, equity is a good bet.
If you are ready to take some amount of risk and yet want stability and balance in your portfolio, putting your money in both equity and debt is the right option for you (balanced funds). On the other hand, if you are a safe player, debt funds may be the right option, to begin with.
ULIPs provide a variety of options to manage your returns due to fluctuations in the markets. The fund switching option is one such feature by which you can manage your returns.
For instance, if you foresee a downturn in the stock market, you can switch a portion of your fund to debt/liquid funds. You can switch it back to equity once the market picks up again and then leverage the upswing.
Similarly, when you are approaching a significant milestone in life (child’s education or marriage), or your ULIP policy moves towards maturity, you can move a maximum portion of the required amount of your investment to debt/liquid funds (at the appropriate time). It will ensure that a large corpus of your investment is secure and can guarantee good returns at the time of maturity.
It is vital that you carry out the fund switching exercise based on your risk profile, your financial goals and volatility of the market.
Nothing can substitute your physical presence, but even if you are no more or lose your job due to permanent disability, your child can continue with his studies, thanks to the child insurance plan. So, make sure that your child receives an uninterrupted education regardless of your presence or absence by purchasing a great ULIP child plan in India.
ARN:- JuneBG/F/27
The aim of saving now is to improve your lifestyle in the future,…
Read More
In 2015, an initiative named "Beti Bachao Beti Padhao" was introduced by…
Read More
Traditionally, parents start a fixed deposit (FD) when a child is born in the family to..
Read More
Individual
