How to Save for Your Child's Education Smartly

Parenting is never easy; being a parent is one of the biggest responsibilities- you are supposed to take care of your child in every possible manner. The financial plan for your child’s future is quite complex, yet it is not impossible to create one that will take care of your child’s requirements. 

A good education is one of the most precious legacies that we can leave with our children. However, quality education doesn’t come cheap, and is bound to get more expensive in the future. Good schools command higher fees. The costs only go up when the child goes in for higher education. That amount almost triples if the child decides to pursue higher education abroad. Many parents do not realize that paying for their ward’s education could be very challenging in the future. Due to lack of this lack of realization or awareness, they do not take adequate steps to plan a smooth path for their child’s education. 

There are many ways one can plan to save and invest for his child’s education: 

1. Equity plans:

This option is meant for investors having higher risk appetite. The gains on equities are tax free.

2. Balanced funds:

This is a good option for conservative investors as they have lower exposure to equity. 65% of the assets are invested in equities and the rest in debt securities.

3. Public provident fund:

This plan will let you enjoy tax benefits and the security of a government financial product.

4. Debt plans:

These involve instruments like short term and long term bonds, money market instruments etc. Investors who would not like to deal with market risk prefer to go for these options.

5. Insurance plans:

These are long term plans that offer both the benefits of insurance and investment; HDFC Life offers Insurance plans which parents can invest in depending on the criteria. HDFC Life Insurance plans offer a range of solutions that are relevant to different life stages, including planning for your child’s future requirements.

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ARN: ED/07/19/14608