Savings for the future of the child | Policies which take care of future requirements of the child, should be selected
If a person is working in a private company. He has a daughter of age 2 years. He wants to save about Rs. 25lakhs by the time his daughter reaches 20 years of age. Then he should save some money from his earnings in the following way â€“
He has enough time to fulfill his requirements, thus the equity and equity related mutual fund saving plans should be chosen which may give large profits in long term even though have some risk. If these plans give him profit of 12%, he can reach his target by investing Rs. 3,513 per month. He will get Rs. 25lakhs by the time his daughter ages 20 years. This procedure may look very simple but it also has some difficulties along its course.
The fact that is to be remembered while investing money is that profit is not the only factor to consider for investing money. It should also be clear that the plan will lead us to our aim of investment without fail.
The age of the daughter is 2 years now. It means that the person has to save particular amount of money every month for 18 years continuously.
The person must invest Rs. 3,513 per month even though having any financial problems. Hence the person should be prepared for any financial problems during the course of the policy.
If the person dies unexpectedly during these 18 years, then the policy may lapse intermediately. The monthly amount may not be paid by the family and the assured sum of Rs. 25lakhs may not be attained. Hence alternative should also be considered while saving money.
Some is interested in longtime investments and decide to reach particular goals. If these goals are linked with the future of some person, then it is better to invest the money in risk free plans. Thus Insurance policies are best for this purpose.
In case of investing for education and marriages of children, it is better to chose secured investment plans to fulfill the requirements with or even without the presence of the investor. The child plans of most of the insurance companies are same. Some functional changes may be present but procedure resembles with each other. The policy will be registered on the name of father or mother by keeping the nominee as daughter/son. In case of Â unexpected death of the policy taker
â—Â Â Â Â Â The responsibility of the child will be taken by the Insurance company
â—Â Â Â Â Â The assured sum will be paid to the nominee on the death of the policy taker
â—Â Â Â Â Â The policy will be continued till maturity period without taking any amount from the nominee
â—Â Â Â Â Â The expected sum will be paid to the nominee after the completion of the maturity period