The child shows a man as morning shows the day. The responsibility of childbearing is a gargantuan task because of the tenderness that child brings with itself. Whether it’s the upbringing or schooling, parents have to struggle through every minute so that their child is not left behind in the competition. However, the most important component that influences a child’s wellbeing is the financial safeguard that parents form for their children. However, in order to plan ideal financial support for your children, you need to have a robust and efficient financial planning that involves everything, from your child’s kindergarten fees to their higher education expenses. Here are a few points that will guide you on how to plan finances better.
Start as early as possible
With the rise in inflation, the financial needs for your child will increase exponentially, thereby putting a heavy burden on your budget. Moreover, the education plans that you are thinking of purchasing for your child also tend to rise with every given day. Therefore, the sooner your personal financial planning for your child starts, the more economical it is. It is also observed that the best practice to ensure perfect financial protection is by opting for a plan right after your child is born because no matter the choice of profession, the money will be spent on whatever she or he chooses to study in future.
Place your bet on a comprehensive insurance policy
It might seem ironical that insurance as a financial product is an option for addressing all the issues related to financial protection. However, in reality, the comprehensive nature of insurance products makes it the best bet against all forms of contingency situations be it an untimely death of an earning parent or the sudden loss of earnings due to critical illness. No matter what the circumstance, the education of your child should not stop just because of the lack of finances.
Investment is the key
Inflation is a large hindrance in all financial products. The ability to better inflation is not available with every insurance product. Therefore, it is important that you also have the option to make the right investments so that you are able to reap the benefits of the return. There are several options available in the market that make a tall claim but to choose the perfect one that suits you and your child’s future makes the actual difference.
When it comes to a child's future, there can be no compromises, which is why it is essential that you practise the habit of financial prudence in a disciplined manner. The upbringing of a child is quite challenging, both emotionally and financially. In some cases, even the emotional front is buttressed if the finances are strong and robust.
Review Your Plan Periodically
In the age of dynamism, everything has a shelf life. So, when you have opted for a financial safeguard, be it an insurance plan or an investment, it is vital for you to evaluate your scheme periodically. Such a review can ensure that you stay up to date with the financial trends, thereby it easy for you to catch up with it if you are lagging behind. This review can also result in either changing the plan or even updating the plan along with the riders.
Diversify Through Asset Allocation
As the proverb goes, do not put all your eggs in one basket. It is advisable to not invest in just one form of a financial product. The best option in this regard is the ULIP, which provides the opportunity to invest in both equities as well as the bond market. In most cases, you also have the option to diversify your allocation as per your risk appetite.
However, once you are decided upon taking a plan, you also need to choose among a lot of plans available in the market, while stirring away from the tall claims. There are a few factors that can guide you to determine the best plan for you. Some of these factors are premium cost, claim settlement ratio, flexibility options etc. Moreover, the advantages of tax benefits under Section 80C and Section 10(10D) are also available with all these plans. Nevertheless, in case of more information, you can call the customer support or even request for an online quote.
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The aforesaid article presents the view of an independent writer who is an expert on financial and insurance matters. PNB MetLife India Insurance Co. Ltd. doesn’t influence or support views of the writer of the article in any way. The article is informative in nature and PNB MetLife and/ or the writer of the article shall not be responsible for any direct/ indirect loss or liability or medical complications incurred by the reader for taking any decisions based on the contents and information given in article. Please consult your financial advisor/ insurance advisor/ health advisor before making any decision.
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