In the present time and age, it has become extremely demanding for the parents to meet the increasing fee framework and other relevant costs pertaining to education. As per some rough estimation, the education inflation comes to a ballpark figure of 10-12% on a yearly basis. Say for instance, an engineering course that costs 8 lakhs today would shot up to 20 lakhs after ten years. On account of this, prior to an effective child education planning of your child, it’s recommended to mull over the inflation aspect.
Steps to Raise Fund for your Child’s Education
Chalk out a plan – Sketch a plan by creating a target amount for your child’s education requirements. With new education courses cropping up every now and then, singling out any one career option at the last moment might get a bit assiduous. However, to arrive at a decision based on information or facts, pick 2-3 career choices, thereby getting acquainted with their present costs. Raise the costs by taking into consideration an increase of 8% per annum for the number of years post which the requirement of the funds would arise. To assess the amount, you can also make use of the child education calculator.
Pre-requisites – In order to have superior organization of the funds, make individual portfolio for the requirements of the child. Moreover, set apart separate funds in case you’re parent to more than one child. Equities are an ideal option to attain long-term objectives.
Portfolio – For the requirement of the child, the investment portfolio must chiefly depend upon the equities. Owing to this, equity-aimed instruments like Equity Mutual Funds can be the cornerstone of a child’s portfolio. Apart from these investments, a PPF account can also be availed of for financing the education requisites of your child. Although PPF being a popular instrument of investment, it is not recommended as it cannot beat the inflation.
A child education plan advisor aids their patrons in evaluating and differentiating the supreme strategy to fulfill their aims. In addition to this, they also inform the parents regarding the different means of investment, which would deal with their financial concerns.