How to plan your child’s future

Every parent dreams of providing his or her child with the best of education and create a bright future for them so that they can survive through the hardships of the life smoothly. To achieve that, you have to start investing and saving early.

However, simply saving money in your bank account won’t solve the purpose that’s why it becomes really important to build a strongly financial portfolio to meet your child’s future requirements. You need to choose the right investment option.

The cost of education or your child’s other expenses is increasing at a faster pace. Your financial corpus should be a right mix of equity and saving plans. Various insurance companies have introduced ‘child investment’ plans, which usually mature around the time of your children’s education or their marriage.

There are various mutual funds as well as ULIP plans that have been created to take care of your child’s expenses.

Given below are key points that parents have to keep in mind before choosing any children saving plan:

• At first, evaluate your child’s future requirements and calculate the expenses that may come up while your child is pursuing education, whether in India or abroad.

• Start saving and investing early. This will help you to build up an adequate financial corpus for fulfilling your children's ambitions and requirements.

• The financial decisions that you ought to take should be according to your risk-taking appetite.

• Never depend on funds that are being saved to fulfil other priorities like retirement, medical expenses etc. for your child's education.

• Do your own research thoroughly before investing in any financial products.

• Go for an insurance product that promises to cover the expenses of your children, which may come up following your unfortunate demise.

• However, try to keep investments and insurance separate.