Why to Use Child Plan Calculator?

The cost of a two-year MBA course in the Indian Institute of Management, Ahmedabad, has risen 400 percent since 2007 and if the same trend continues, it will reach a stupendous Rs. 95 lakhs, according to a report in the Economic Times. Can you imagine how much you would need to save if you wish to send your child to such reputed institutes? An approximate estimate for the amount of funds required by you to meet your child’s advanced education can be estimated using tools like a child plan calculator.

Need for Child Insurance Plans

Rising education costs and high aspirations of parents warrant the need to build a substantial kitty to fund the massive costs of education, co-curricular activities and other requirements. Add to this the cost of their marriages and the total amount required for your children’s welfare shoots up further. What to do in such a scenario? Invest in a variety of options like a child plan and make some investments that offer good growth.

The exact amount of funds that you will need and can invest now can be decided with the help of insurance tools like child plan calculator and retirement planning calculator (if you are looking for an investment for building a post retirement fund). Using these tools is very easy as all you need to provide is the current age of your child, the age at which you need the funds, your current savings, the type of education which you want your child to pursue, the expected tuition fee and the inflation rate. By using this information, the tool provides you with the amount of funds that you need to save. Now, you have a final target and can calculate the amount of monthly savings that you need to target.

Child insurance plans can be regular premium plans or single premium plans. In case of the former, annual premium payments need to be made until the child turns 18 and after that, the insurer pays back the amount in installments or in one go, depending on the terms of the policy. Such policies generally cover the life of the parent and in case the parent dies before maturity, the premiums are waived off but the sum assured is paid on maturity.

While some child plans are money back plans, others are unit linked policies, which invest in the market to create wealth for the policy holder. Most insurance companies offer varied options with different risk profiles to cater to the requirements of all types of investors.

Apart from offering life cover, several child plans come with options to add various types of riders, so that you can combine the goal of saving for your children with other aims like taking accident insurance or critical illness insurance.

4 Things to Ensure You Have a Fun & Relaxed Retired Life

Your ability to save and invest while you are working will decide whether you can lead a happy retired life or have to struggle to meet even your regular expenses post retirement. The key to successful investing is to start as early as possible and save from the day you start working. The compounding effect of your early savings will prove to be very fruitful and go a long way in helping you build a safe and healthy corpus for your retired life.

Use the Right Tools to Plan

By using tools like a retirement calculator or a pension plan calculator, you can easily determine the amount of funds you would need post retirement and how much need to invest to achieve that goal. The earlier you start, the better it will be for you to build a reasonable corpus to spend your retired life in a relaxed manner, without any kind of financial worries.

Tips for Retirement Planning

Here are some tips that will help you enjoy your retired life:

• Always keep a specific percentage (say about 10 percent of your earnings) for saving purposes and invest them in long term investment options. This could be done via investment in a public provident fund or pension funds. Increase the amount saved with every increase in your salary. This will help you deal with the impact of inflation on your post retirement expenses.
• Avoid using the funds kept aside for your retirement to fulfill any other needs or expenses that come up during your everyday life. Also, try to use only a small percentage of your retirement corpus in the first few years of retired life. This is important to ensure that you don’t outlive your savings and have to struggle for funds in the later years of your retired life. You can use a retirement calculator to keep track of the savings too.
• Ensure that you have repaid all your loans or debts before you retire. Also, modify your investment from equity to debt as your age increases or you near retirement so as to reduce the risk involved.
• Invest in a health insurance plan so that you do not need to borrow from your retirement kitty to pay hospital and medical expenses. Buy a plan that offers you the maximum coverage, since getting health insurance is difficult as you age and develop chronic ailments like high blood pressure and diabetes. Buying a term insurance or life insurance plan is also recommended to protect your dependent family members from any kind of financial worries if something untoward happens.

So, using retirement planning calculators, saving consistently, investing wisely in insurance products and repaying all debts before retirement are the prerequisites to a happy retired life.