The idea is to build a financial plan that acts as a ladder for your child's needs. As your child is dependent on you, it is your responsibility to take care of him/her even if you are not around. Begin with an insurance policy. Opt for a term plan with a sum assured of at least 10-15 times your monthly income.
One of the greatest wonders of a newborn is that a whole world of opportunity is open for your baby to grow into. opportunity is open for your baby to grow into.
And one of the greatest challenges you face as a parent is keeping the world open to him or her, no matter what happens along the way.
When your baby is just learning to smile and grasp your finger, university education may seem too far away even to contemplate. But if you want to fund your child’s education, you'll need to amass a large amount of money. By planning ahead, you can provide a much wider array of education options.
Start a college fund as soon as you can for your child. The power of compound interest means a small amount invested 18 years in advance will grow much more than a larger amount saved a year or so before it's time for university.
The idea is to build a financial plan that acts as a ladder for your child's needs. As your child is dependent on you, it is your responsibility to take care of him/her even if you are not around. Begin with an insurance policy. Opt for a term plan with a sum assured of at least 10-15 times your monthly income.
Life cover for the child.
Build a fund for child’s future needs.
You can add riders to the plan.
Death benefit and maturity benefits are paid.
Waiver of premium rider can also be opted.
You can decide the premium amount based on the sum assured and the maturity amount than you choose.
Partial withdrawals are allowed as and when you need to meet your child’s educational requirements or for meeting other related expenses.meeting other related expenses.
Provision to meet academic expenses of your child.
Provision for miscellaneous and extracurricular expenses that occur during college or school.
Lump sum amount is paid on maturity.
Moneyback benefit can be availed.
There are two death options that you can choose from. Classic option is when the death benefit is paid and after which the policy will terminate. Classic Waiver option is when the death benefit is paid but the policy will continue and the future premiums are waived.
The policy premium payment term is 7, 10 years or policy term minus 5 years.
You can choose the policy term as per your child’s future needs.
Guaranteed additions are paid during first 5 years of the policy years.
Accrued bonuses are payable at maturity.
Tax benefits are available under Section 80C and Section 10(10D) of the Income Tax Act, 1961
Guaranteed smart benifits are paid for 4 years @25% of the Basic sum assured and 25% of the vested simple reversionary Bonuses after the child attains 18 years and till he reaches 21 years
On maturity , the last instalment of the smart benefit including vested bonuses and terminal bonus, if any , is paid to the policy holder.
On death or disability of the policy holder within the term , a lump sum death benefit will be paid which will be a multiple of the single or annual premium paid depending on the age of the policyholder.
The future premiums are waived but the policy continues and future bonuses also accure.
Smart benifits are paid as under the original terms
Alternatively , the discounted value of smart benefits and vested bonuses can be received in one lump sum in the last 3 premium years.
Income tax benifit on the premium paid as per section 80c and on the claims received as per section 10(10D) of the income Tax Act.
Choose between pay-out options that are based on your child’s needs – Money back or Endowment.
a. With the Money back option, you will get guaranteed pay-outs in the last 5 years before Maturity to meet your child’s education needs. At Maturity you will get guaranteed Maturity pay-out for your child’s higher education and career needs.
b. With the Endowment option you will get a guaranteed lump sum amount at Maturity, provided the Policy is in force, to help meet your child’s dream.
Built-in Premium waiver benefit ensures that your child’s needs will be taken care of. If something unfortunate were to happen to the parent (Life Insured) the future Premiums are waived off while all the benefits in the policy continue.
Flexibility to choose your Policy Term – between 11 and 21 years. Based on your child’s age, you can choose a Policy Term between 11 to 21 years. Also choose the Premium payment type –‘limited pay’ where the Premium payment term is 5 years lesser than the Policy Term or ‘regular pay’ where the Premium payment term is equal to Policy Term.
Potential upside with bonus. Non-guaranteed annual simple reversionary bonus gets accrued to the policy at the end of each year provided all due Premiums are paid and is payable at Maturity. The company may also declare non-guaranteed terminal bonus that will be also be payable at Maturity.