Child education policy: More than just securing your child’s future

Surprising enough, but truth be told – children have dreams and they plan for it too. As a parent, you are not only supposed to guide them but also support their goals. However, the first step to helping them fulfilling their dreams is by giving them a proper education. Some of the child schemes in India also offer an opportunity to provide this support to your children.

In this article, we will discuss the various benefits of the child education scheme:

Cost of education:

Although education is a noble profession and the cost of it is increasing by the day. In the future, it will be more expensive than what it is today. Additionally, you will also have to consider the school picnics, fancy dress competitions, sports equipment, tuition fees in school and colleges, etc. With a child education scheme, you will be able to provide for all this without experience a dent in your finance.

The magic of compounding:

Generally, the child education schemes in India require monthly investment, in the form of premiums. These premiums, by the law of compounding, are then turned into handsome sum during the term of the policy. You can use this financial corpus to pay fees for your child’s higher education well in time.

No need for loans:

Many times, parents opt for loans to fund expensive degrees for their children. This loan either piles up on the parents’ shoulders or the child’s. The child education scheme in Indian lets you have eliminate this liability.

Tax Benefits:

A child education scheme comes with tax benefits too. The tax claim can be made on the payable premiums, which is deductible under section 80(C). At the time of maturity, this amount is exempted from tax. The calculation for tax exemption for this scheme is the same as fixed deposits and equity shares, which also come with a long-term capital gains tax.

Apart from this, many child education schemes allow you to compliment the insurance with additional riders. These riders offer more financial cover. However, these riders help if you commence the investment in this scheme as early as possible.

So, be prepared for your child’s future well in time. A child education scheme is a right step to take. Only, you have to take this step well in time to help make your child’s dreams come true.