Child Future Planning
- The Birth of a child is a major life event that brings both joy and a sense of responsibility to parents. It often makes parents more serious about their financial planning, sometimes even prioritizing their child's future over their own retirement.
Nowadays, people generally don't differentiate between sons and daughters, treating them equally. However, when it comes to financial planning, many still follow traditional methods like buying insurance policies or bonds for their children. Some modern parents opt for child Unit Linked Insurance Plans (ULIPs) instead of money-back policies, but this may not be the best choice. These decisions are often driven by emotions rather than smart financial planning.
As a parent, you want to ensure your child's future remains secure, even if you're not there. We can help you make your child's future safe and secure.
Secure Your Child’s Future with Sainik Dhan Rakshak
As parents, there’s no stronger aspiration than providing the very best for your children. However, turning dreams into reality often requires navigating practical financial challenges. At Sainik Dhan Rakshak, we believe in helping you plan your child’s future so that all their needs—be it education or other milestones—are met without stress or last-minute hassles. What is Children’s Future Planning? Children’s Future Planning focuses on building a financial corpus for key milestones like higher education, weddings, and providing financial security during their formative years. Here's how you can make this happen:1. Set Up a Dedicated Bank Account
Begin your financial planning journey by opening a bank account in your child’s name. Just as you thoughtfully chose their name, this account reflects your dedication to their future. It serves as a safe place to accumulate funds, gifts, and tokens of love meant for their journey ahead.2. Secure Your Family with Term Insurance
The recent global challenges have highlighted the importance of preparedness. Safeguard your family’s financial future with term insurance for earning members. This ensures stability and support for your loved ones in unforeseen circumstances, offering peace of mind during difficult times.3. Plan for Short-Term Goals Like School Education
Cover immediate expenses like clothing, healthcare, and school education by planning for short-term goals. Options like Fixed Deposits (FDs), Recurring Deposits (RDs), and debt mutual funds are ideal for investments under three years. For longer durations, consider equity-based investments for higher returns.4. Invest Early for Higher Education
Higher education comes with significant costs, and early planning ensures you’re ready when the time comes. Consider factors such as current education costs, inflation, your child’s age, and expected returns. Long-term investments in equity funds (7–10 years or more) can help you grow a robust education fund for your child.5. Teach Financial Literacy to Your Kids
Empower your children by teaching them the value of saving and smart money management. Share your financial knowledge and lead by example, helping them develop habits that secure their financial independence.6.Transform Financial Discussions into a Family Tradition
Encourage financial discussions at the dinner table to boost your children’s financial literacy and ensure active participation from all family members, especially women. Building a culture of financial awareness within the household sets a strong foundation for your child’s future.
A Financial Plan in Action
Scenario: Planning for Higher Education (Undergraduate)
- Assumptions:
- Child’s current age: 1 year
- Inflation rate: 7%
- Goal duration: 18 years
- Current Cost of Higher Education: For professional courses like engineering or medicine, the cost can range between ₹3,00,000–₹5,00,000 per year. With additional expenses, this amounts to ₹10.5 lakhs (minimum) for a 3-year program.
- Future Cost: After 18 years, the projected cost is approximately ₹34 lakhs. To accumulate this amount, an SIP (Systematic Investment Plan) of ₹7,500 per month at an 11–12% CAGR is needed.
Scenario: Planning for Postgraduate Studies (MBA)
- Assumptions:
- Goal duration: 22 years
- Current cost of MBA: ₹30 lakhs
- Future cost: Over ₹1 crore
- Plan: To achieve this, an SIP of ₹10,000 per month at a 12% CAGR is required.
Understanding Future Value
For instance, if you plan to save ₹30 lakhs for your daughter’s education and ₹10 lakhs for your son’s, with an 8% growth rate over 10 years:- ₹30 lakhs grows to approximately ₹52.6 lakhs.
- ₹10 lakhs grows to approximately ₹17.4 lakhs.
At Sainik Dhan Rakshak, we’re here to guide you through every step of securing your child’s bright future. With our expertise, you can build a financial plan that meets their needs without compromising your peace of mind. Start today—because the earlier you plan, the brighter their future will be. - Assumptions:
