Education Loan Or Education Plan - Which Is A Better Option For Your Child?
Published On Dec 06, 2021
It's tough to plan for a child's future financial goals, and many parents incorrectly feel that a school loan will save them. Although an education loan may be a reasonable option, it cannot replace the requirement for investment in order to attain the goal, as the child may also require help in other areas. The first question that parents have when thinking about their child's future is, "What would he/she like to do?" While schooling and other costs can be covered with regular income, the cost of additional education is a different story. Given the difficulty of anticipating a child's future needs, as well as the high cost of a career-defining education, such as tuition fees, books, admission, and other expenses, which option would you choose: an education loan or saving for a child's education?
Education Loan Vs. Education Insurance Plan
Although an education loan is a great option, it does not eliminate the need for future investments to care for your child, as your child may want further financial aid in other areas. On the other hand, a child insurance plan is a combination of insurance and investment programs that protects your child's financial security in the future. They offer flexible payouts at significant milestones in your child's life, in addition to the cash-secured as a lump sum payment at maturity. Many parents opt for a student loan, while others opt for an education insurance plan that best suits their needs.
- Education loans might assist you in paying for your child's education entirely within that timeframe. An education insurance plan, on the other hand, will carefully save and invest your money in order to meet your child's educational and other demands.
- Because you must repay the loan in equal monthly instalments (EMIs) as soon as your child completes their studies and achieves employment, an education loan, like other loans, is a financial burden on your child and, by extension, you.
- Education insurance plans Your family, especially your child, is deserving of your love and care. Invest (and reinvest) in a family insurance plan to cover everyone.
- In the event of unforeseeable events, your family can get the sum insured amount as immediate death protection.
- In comparison to student loans, child insurance policies come with a slew of tax benefits.
- Above all, education insurance policies allow you to avoid the entire loan repayment process.You can also withdraw a portion of your money and invest the remainder to spend later.
So, if you're a new parent looking to invest in a mutually beneficial plan that allows you to save and reinvest so that your child benefits later. Consider purchasing a plan for your child's education. If you have enough money and have no intention of increasing it, you can take out an education loan; nevertheless, the peace of mind that comes from saving and investing your hard-earned money is priceless to you and your family. In conclusion, an education plan or a ULIP plan is a great way to insure and invest. You also provide financial security for your child, allowing you to meet their basic necessities, such as education, treatment, and other small costs. You should be proud of yourself for paying for your child's education and other essentials on your own. It's up to you to enjoy it.
Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.