If you’re a parent, then you’ll understand just how tough it is to plan the finances for the future of your family. There are tons of things to take into account of, including health insurances, life insurances, general insurances and even normal savings and investments. With so many options available out there, it really is hard to keep track and choose the perfect one to fit your situation in life. One of the more important topics that parents often touch on is the endowment plan for their children’s studies.
With inflation causing the price of goods to be ever increasing on a yearly basis, this would result in prices of education in university increasing to abysmal levels by the time your child grows of age. If you’re a parent, you’re bound to hear about this plan and should have gotten it as it is one of the few plans out there that makes really reasonable sense. You wouldn’t want your children having to work part time during their studies instead of focussing their time on their studies. If you choose to get an endowment plan, not only will it provide competitive returns that will cover for inflation, but there is a chance that you will get more out of your money through the investment. Not to mention, education endowment plans provide protection coverage at a percentage of your total premiums which you have invested.
Base on inflation of 2% per annum, the sum of $38,450 is equivalent to a future value of $51,749 in 15 years time.
Now if you’re thinking that maybe you’ll invest your money in other areas, you have to take into account that with higher returns come higher risk. What you’re paying for with endowment plans is the protection you’ll get along with the flexibility in the saving time period. There will be no disruptions to your saving plans and additional options to consider should you feel that you have more time to invest your money in.
If you’re serious about thinking about your child’s education, you should consider an education endowment insurance plan to grow your savings and have a peace of mind. Start with planning how much funds you currently have in your savings, along with the projected value of your investments. Of course, out of all these funds, you have to be willing to use all of them in your child’s education. After finding the value of this, calculate the cost of your child’s education expense, including tuition fee and living expenses. Once you have that subtract both values to obtain the shortfall which is the money you require within the number of years before your child reaches the age for the university. That shortfall is the money you hope to obtain from your investments and from there you can work out the appropriate investment plans which you require. There are many of them, including education endowment plan but you have to remember that you are not limited to that. Bonds, equity investments, unit trusts and exchange traded funds are all equally competent depending on your needs and should be considered.
As parents we want to give our child a good head start, Zefflin has helped several parents planned for their child's future. Positive testimonials from parents as he continues to strive for a better future for your child. For more details about saving up for your child's future education. Please contact him at 96613227 or email him for an appointment at zefflin.cheong@axaplanner.com.sg