A new-born in the house brings a bunch of responsibilities that are to be taken care off on priority. Growing a child is fun as well as a fantastic experience, but the parents are always concerned about the child’s future. The intention behind the act of saving money is to provide the best things to the child. In this article, we shall focus on how you can secure your child’s future. Read further to know more.
Child insurance plans offer you both, life cover and investment. Investment lets you build a corpus to take care of your child’s requirements such as his higher education, marriage and other needs if any. If by misfortune your income gets interrupted, it is always taken care that your child’s education and other goals are achieved without any trouble.
It would be terrifying if a parent, who is a sole breadwinner in the family gets deceased. In such cases, the family and the dependents have to compromise on their lifestyle, and apparently it affects the child’s future. The only option to overcome this situation is to opt for a sizeable life cover. There are several life insurance plans; especially term plans are considered to be the best because of lower premium rates and larger cover. But you need to understand that if the life insured survives the tenure, he doesn’t get any benefit of the policy and on his demise, a lump-sum is paid to the beneficiaries. Whereas in case of child insurance plans, not only a lump-sum is paid to the beneficiaries on the demise of the parent, but all the further premiums are waived, and the investments are continued till the end of the policy tenure on behalf of the beneficiaries.
As per the policy terms, the beneficiaries, especially the child gets the pay-out amount at particular intervals and his needs are taken care off even in the absence of the parent. The premiums paid for the policy are tax-free under Section 80C, and the pay-outs are tax-free under Section of 10(10D) of Income Tax Act. Several companies in the market offer child insurance plans, out of which some plans offer market linked returns to the policyholder.
In short, Child education plan helps in several ways such as building a sizeable corpus for the child, life cover to parent, tax benefits and market linked benefits if any. Also, you can add riders to your policy to get additional cover for a specific cause. Invest in child plan and secure your child’s future, today!