Best Child Plan for Education and Marriage
Every parent wants to see their children thriving in their career and personal lives. Therefore, proper planning is always paramount. Financial planning for children requires extreme care and research. You must make sure your children do not face financial issues when they grow up. This depends on your present actions regarding finances, including investments that generate returns for the rest of your life.
Today, there are a plethora of investment options available in the financial market. Before making a choice, it is important to weigh each one based on your requirements. Early investment should be on your priority list if you want to help your child achieve their best in terms of a career.
Marriage is another milestone in your child’s future. A considerable financial corpus will make it possible for you to have a great wedding for your child and support them financially after the marriage.
In the blog below, we will learn about the best child plan for education and marriage. We will also be talking about each plan’s features and eligibility criteria.
Best Child Plans for Education and Marriage
Here are some of the best child plans in India that you can consider investing in.
- SBI Life Smart Champ Plan
- LIC New Children’s Money Back Scheme
- ICICI Pru Smart Kid Solution
- Max Life Shiksha Plus Super Plan
- HDFC Life YoungStar Udaan Plan
Let us look at each of these plans in detail below.
The SBI Life Smart Champ Plan is an investment scheme meant for your child’s education in the future. It is a non-linked participating plan that combines the benefits of a life insurance plan and investment scheme. The plan helps you create a separate corpus for your child’s future education.
Besides the substantial savings, SBI Life Smart Champ Plan also helps your child get coverage against an unfortunate eventuality . This is because the plan offers life insurance coverage along with investment options. Let us look at some of the features of this scheme.
The following features characterize this plan:
- The plan offers a combination of investment and life cover. This provides complete protection to your child against health and educational expenses.
- If the policy lapses, it can be revived within 2 years.
- The plan offers a death benefit, maturity benefits, and survival benefits.
- The plan will also offer a Life and Accidental Total Permanent Disability (ATPD) to every policyholder, with 105% of all the premiums paid till death.
- The plan offers accrued and terminal bonuses at the end of each policy year.
Following are the eligibility criteria for the plan:
- Minimum entry age limit for the child: 0 years
- Maximum entry age limit for the child: 13 years
- Maximum maturity age for child: 21 years
The LIC New Children’s Money Back Scheme is a non-linked, participating, life assurance money-back plan that ensures considerable savings for your child’s future. This plan works as a money-back plan that has survival and death benefits for the policyholder. This scheme also has a life coverage option that protects your child against injuries and accidents. In addition, the money can be used for your child’s education, marriage, and other expenses that might arise when they grow up.
Following are some of the characteristic features of this scheme:
- The plan has a maturity term of 25 years, excluding the age at entry.
- The plan offers survival benefits to the nominee of the policyholder. Even if the policyholder survives the entire policy term, the sum assured will be awarded to the surviving nominee or child.
- The plan offers a free-look period of 15 days.
- The minimum limit for the sum assured for the entire policy term is INR 1,00,000. There is no maximum limit for the same.
- LIC also offers a grace period after which the premiums must be paid at any cost. The grace period lasts between 15 and 30 days, depending on the policy term and the size of the premium.
The eligibility criteria for the plan are as follows:
- Minimum entry age for the child: 0 years
- Maximum entry age for the child: 12 years
- Maximum maturity age for child: 25 years
The ICICI Pru Smart Kid Solution plan is a unit-linked, non-participating plan that helps you create a corpus for your child’s future financial requirements. Like all other Unit-Linked Insurance Plans, the ICICI Pru Smart Kid Solution has dual benefits in the form of life insurance coverage and investment opportunities.
The plan consists of two investment strategies:
- Fixed Portfolio Strategy: This strategy offers you an option to allocate your savings in funds chosen by you.
- LifeCycle based Portfolio Strategy: Under this strategy, the plan will create a feasible balance of debt and equity based on your age.
Let us look at the features of the plan below:
- In the event of the policyholder’s death, the surviving nominee will receive the death benefits and immediate reimbursements for the death-related expenses, if any. The death benefit can be obtained in a lump sum.
- As a maturity benefit, the plan offers total fund value to the child.
- If the insured dies before the end of the policy term, all the future premium payments are waived off.
- The plan also offers an accidental death rider to be bought at the time of policy purchase.
- Partial withdrawals are allowed to help with financial emergencies. You can apply for such withdrawals after 5 years of purchasing the policy.
- The plan offers premium payment flexibility. Policyholders have an option to pay the premium just once, for a limited period, or throughout the policy term.
- Under the regular premium pay option, the minimum and maximum limits for policy term are 10 years and 25 years, respectively.
The eligibility criteria for the plan are:
- Minimum entry age: 20 years
- Maximum entry age: 54 years
- Minimum maturity age: 30 years
- Maximum maturity age: 64 years
Under the Max Life Shiksha Plus Super Plan, parents can save money for their child’s future financial needs. This plan is also a suitable girl-child marriage investment plan meaning, you will not have to worry about the child’s marriage in the future with a significant fund created in their name.
This scheme is a unit-linked, non-participating, individual insurance plan that also offers a life cover for your child’s security. In addition, other financially-dependent needs such as education, accommodations, etc., will also be taken care of by the funds received at the end of the maturity.
Let us look at the features of the plan:
- The plan is devised for people who have children aged between 0 and 18 years.
- The plan offers a transfer plan option through which the chances of higher returns increase. The money is systematically invested from one investment scheme to another at regular intervals, helping the overall return grow exponentially.
- There are six different fund options in the plan. These include investments in corporate bonds, government securities, cash and money market instruments, etc.
- At the end of the 11th policy year, the plan will add additional units to your fund every year.
The eligibility criteria for the same are as follows:
- Entry age limit: 21 to 50 years
- Maximum maturity age: 60 years (for 5-pay option) and 65 years (for regular pay option)
HDFC Life YoungStar Udaan Plan
Another popular plan for securing your child’s future is the HDFC Life YoungStar Udaan Plan. It is a non-linked participating life insurance plan. This plan combines the benefits of a money-back and an endowment plan.
Under this scheme, you have a choice of three investment options based on your requirements:
- Aspiration option: This option offers the maturity benefit to be paid in lump sum.
- Academia option: This option focuses on the education of your child. Under this, payouts will be offered in the last 5 years before maturity.
- Career option: Under this option, you will receive payouts in the last five years before maturity. This option mainly focuses on your child’s career.
Following are the features of the HDFC Life YoungStar Udaan Plan:
- The plan has an option for limited premium payment. Under this feature, the policyholder has to pay their premium for a limited period, and they can enjoy comprehensive plan benefits post that period.
- Policyholders can also apply for a loan up to 80% of your total surrender value of the policy.
- There are two types of death benefit options- Classic and Classic Waiver. Under the classic waiver option, future premium installments will be waived off.
The eligibility criteria for the plan are:
- Minimum entry age: 0 years (30 days)
- Maximum entry age: 60 years
- Minimum maturity age: 18 years
- Maximum maturity age: 75 years
Why Do You Need to Save for Children?
Following are the reasons why you should save for your children:
- The future holds unlimited potential for your child to grow. Therefore, it is essential to plan your finances in such a way that you can focus on future opportunities without thinking twice about the expenses.
- Even if you are not there to support your children in their future, your investment will make a lot of difference in their lives. Your child will not have to look for other financial avenues to support themselves and their careers.
- The best child plan for education and marriage will be the one that takes care of all the expenses required for providing your child with a successful career and happy married life.
- Investment plans provide death and maturity benefits to your child that can be used for education, marriage, and many other events that require a significant amount of funds.
- Most of the investment plans in India offer tax benefits which are aimed to encourage more citizens to opt for these types of plans.
- If you need an immediate loan during the term of the policy, you can apply for the same against your investment scheme.
In conclusion, saving for your child’s future is always a crucial decision. You would not want your child to be unable to fend for themselves if you are not there to support them in the future. Therefore, choose a suitable investment scheme that is the best for your child’s education and marriage and create a comprehensive financial plan for your child. There are a variety of plans available from various financial institutions. You should opt for the one which suits your investment objectives.
What is the maturity benefit offered by the SBI Life Smart Champ Plan?
At maturity, the policyholders of the SBI Life Smart Champ Plan will receive a lump sum amount as the sum assured at the beginning of the plan. In addition, if the policyholder passes away during the policy term, the child or the surviving nominee will receive the maturity benefit of the plan.
What is the premium payment mechanism for the LIC New Children’s Money Back Plan?
Under the LIC New Children’s Money Back Plan, the policyholder can pay the premium based on their convenience. The scheme offers the option to pay on a half-yearly, annually, and quarterly basis. Monthly payments can also be arranged for people with a steady flow of income.
Is it possible to switch funds under the ICICI Pru Smart Kid Solution plan?
Yes, policyholders can switch between funds if they deem fit. Based on their risk-bearing appetite, policyholders can change funds between the policy term and reap more benefits through the additional riders.
What constitutes the career option under the HDFC Life YoungStar Udaan Plan?
Under the career option plan in the HDFC Life YoungStar Udaan Plan, the policyholder has an opportunity to plan for their child’s career. This entails the returns being paid five years before the policy matures.