Can I Invest in ULIPs for My Child’s Education?
Updated On Jan 20, 2023
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Parenthood is one of the most delightful phases of everyone’s lives. Isn’t it? However, in addition to pleasure, a lot of responsibilities are uninvited. One of the most important is planning the future for our children to provide them with the best education. ULIP plans are one of the best sources of savings and investment for your children. You must be wondering what ULIPs exactly do and how they can be beneficial to my child’s education. In this article, we’ll know why ULIP child plans are the best investment. But before that, let’s first understand how ULIP works.
How Do ULIP Plans Work?
ULIPs are a mix of protection and investment. This means that the policyholders get the dual benefit of life insurance coverage and wealth creation. The regular premium payments are made by the insured when they purchase ULIP plans. A portion of this premium amount is used to provide life insurance coverage, while the remaining amount is invested in funds like debt, equity, or debt-equity. You can choose the amount and fund type in which you want to invest depending on your financial goals and risk portfolio. It is best to start investing in ULIPs at an early age to get healthy returns. Furthermore, the policyholders can switch between funds according to their financial needs at different life stages.
ULIP As an Investment For Child’s Education
Considering the educational inflation in the account, higher education is an important factor to be considered while planning for children’s goals. One of the best reasons to invest in ULIPs for a child’s education is that you need not worry about your child’s future in the event of your death. Through the ULIP investment funds, your children may be able to fulfill all their educational goals without worrying about finances. Moreover, you can send your children abroad to study without worrying about the hefty cost of educational expenses and university fees.
It is the most important financial objective for a parent to create a complex savings strategy to safeguard their child’s future. However, choosing a savings plan in India might be challenging. Therefore, in this case, ULIP plans come as a saviour. ULIPs inculcate savings habits in you and ensure that you create a corpus of funds for your children's education.
ULIP Plans For Children’s Education
There are numerous life insurance companies in India that provide ULIP plans for children. Some of them are listed in the section below.
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Aviva Young Scholar Advantage:
It is a unit-linked insurance plan that will protect your loved ones, especially children, after your demise. In the absence of a parent, the insurance company will take care of the children financially. It is a comprehensive life insurance plan with seven fund types.
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HDFC Youngstar Super Premium:
It is a ULIP plan available with a regular payout option for the policyholders. Under this plan, you have a choice between two coverage options: life and life with health.
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Max Life Shiksha Plus Super Plan:
It is a unit-linked child insurance plan with regular and limited premium payment options. Children aged between 0 and 18 years are eligible for the Max Life Shiksha Plus Super Plan. In the event of the death of a parent, the child’s future is secured as they receive family income benefits and funding for future premiums.
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SBI Life Smart Scholar Plan:
It is a non-participating unit-linked child insurance plan with a limited premium payment option. Policyholders can invest in one of seven available funds. Under this plan, the insured is eligible to receive the total fund value upon maturity.
Conclusion
Now that you know that you can secure your child’s future with ULIPs, it is the best time to start your investment. ULIP plans will not only provide you with financial security but will also ensure mental and emotional stability in your child’s future. You can compare the features and benefits of numerous ULIP plans to choose the best one according to your financial needs.
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