Education Loan vs Education Plan: What Is Better For Your Child?
Updated On Nov 29, 2021
Planning for a child's future financial objectives is difficult, and many parents mistakenly believe that a school loan will save them. Although an education loan may be a viable alternative, it cannot replace the need for investment in order to achieve the goal, as the child may require assistance in other areas as well. When it comes to planning for their child's future, the first question that arises is, "What would he/she like to do?" While schooling and other fees can be met with your regular income, further education prices are an entirely different story. Given the difficulty in predicting a child's future demands, as well as the high expense of a career-defining education such as tuition fees, books, admission, and more, which option would you choose: an education loan or saving for a child's education? (education plan).
Education loan Vs. Education Insurance Plan
An education loan may be a wonderful alternative, but it does not eliminate the need for future investments to care for your child, as your child may require more financial assistance in other areas as well. A Child insurance plan, on the other hand, is a combination of insurance and investment programs that ensures your child's financial security in the future. Not only is the sum secured accessible as a lump sum payment at maturity, but they also offer flexible payouts at key milestones in your child's life.
While many parents choose to take out a student loan, others choose an education insurance plan to suit their needs.
- Education loans can help you pay for your child's education solely within that time period. However, an education insurance plan will carefully save and invest your money so that your child's education and other needs are met.
- An education loan, like other loans, is a financial burden on your child and, by extension, you, because you must repay the loan in equivalent monthly installments (EMIs) as soon as your child completes their studies and obtains employment.
- Plans for education insurance Your family, particularly your child, deserves your support and protection. Invest (and reinvest) in an insurance plan to protect your entire family.
- Your family can get the sum insured amount as urgent death protection in the event of unanticipated events.
- In comparison to education loans, child insurance policies offer numerous tax advantages.
- Most importantly, education insurance policies allow you to skip the whole debt payback saga. You can also take out a portion of your money and invest the rest so that you can spend it later.
So, if you're a new parent who wants to put money into a mutually beneficial plan that will allow you to save and reinvest so your child will benefit later... Consider purchasing a Child’s education insurance plan. You can take out an education loan if you have enough money and have no intention of growing it; nevertheless, the piece of mind that comes from saving and investing your hard-earned money is invaluable to you and your family. In short, an education plan or a ULIP plan is an excellent option to both insure and invest. You also obtain financial security for your child and can cover their needs, such as education, therapy, and other minor expenses. You should be proud of yourself for self-financing your child's schooling and other necessities. You must take pleasure in it.
Also read: Top Child Education Plans India
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.