How Important is Planning for Children's Higher Education

HOW IMPORTANT IS PLANNING FOR CHILDREN'S HIGHER EDUCATION Introduction: Your child is the apple of your eye and you want the best for your little one. Wishing so is one part but ensuring that your wish becomes reality is another and more important part. The best way to achieve what you wish for is to plan as planning plays a critical role in execution. What is the best time to plan? The best time is now! If you missed the bus, when your child was born or still small, it is still not too late. Over the years, you would have noticed, how the cost of education is spiraling through the roof. What used to be a reasonable cost of education is now inordinately expensive. It is not surprising that the school fee for a child studying in the lower classes (grade 1 to grade 4), ranges anywhere between Rs. 40,000 to Rs. 1 Lac in reputed schools. Assuming inflation at 15%, what costs Rs. 50,000 today, would cost Rs. 2 Lacs in year 2020. Are you prepared for this?   Plan: As the saying goes, the early bird catches the worm. Nothing is truer than this. What was a dream a decade ago, has become a reality today. With proper planning, it is possible to ensure a corpus to sufficiently finance your child's higher education costs. With increasing opportunities today for children in a wide range of professions, like fashion or photography, it is more important to plan well so that you are prepared to meet the aspirations of your child. Once you have made up your mind to invest in the future educational needs of your child, then you need to weigh various modes of investment for achieving this goal. First of all, draft a mission statement before finalizing your options. A mission statement may include: Quantification of the corpus (say, Rs. 20 Lacs) Indicating the time horizon (say 15 years) Allocating the assets (Debt : Equity) There are several customized plans offered by Life Insurance companies that may help in ensuring that you meet your financial goals for your child's higher education. For example, in a child plan, you could choose an aggressive growth fund, which is tilted more towards equity in terms of asset allocation in the early part of the plan. In the latter part of the plan term, as you move towards plan maturity, depending upon your choice you may choose to allocate your assets towards a debt-oriented fund, thereby ensuring capital protection. Alternatively, you can look at annuity based insurance plans which may guarantee fixed payouts from age of 18 to 21 years of your child, to fund higher education needs. Choice is yours! Conclusion: With education getting more focus and multiple disciplines of higher education becoming available today, it is paramount that you plan for your child's higher education in right earnest. If you have not planned yet or invested for it - then now is the time is to do so. Max New York Life Insurance Company Limited is a joint venture of MAX India Limited and New York Life International LLC. Max New York Life Insurance Co. Ltd, 11th Floor, DLF Square Building, DLF City Phase II, Gurgaon (Haryana) -122002. Insurance is a subject matter of solicitation. For further details call Customer service (Toll Free) 1800 200 5577 ARN MNYL / Ads / Euro / MNYLT / 01

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