- September 19, 2018
- Education Insurance
- Parents NoticeBoard
Why you need to save for education! Part 2
Do you watch movies so often so as to come across the description ‘trust fund babies ‘?
Does it irk you to think that it’s a privilege of a few well off people! Alternatively does it motivate you to do better for your kids.
Ofcourse responsible parents want their kids to have better opportunities in life when they get older?
If you fall in the latter, I have a question for you.
Have you considered a Child Education Plan?
“What is that? “ You ask.
Well, it’s actually a life insurance product designed as a savings tool. It helps you to provide money to your kids when they enroll to college.
In most cases that falls between the ages of 18 years and 20 years old.
Remember in the last article Part 1, we covered the fact that due to inflation the value of money is always on the rise, but also, the cost of higher education is rising.
So the earlier you begin to save, the more time your money has to grow and the more interest you ll have.
But then you ask, “How do I even begin? “
First, you need to put a lot of thought in to how much you want to set aside. You can do the math and then always remember to factor in inflation.
You may be in denial about it, but just factor it in to be on the safe side.
Inflation always rises tested and proven!
After that, make sure the premium required from the insurance company is affordable. Don’t want to overstretch yourself.
Ensure that there is flexibility.
Flexible premiums allow you to gradually increase premium amounts as your income increases.
Finally, go for a payer benefit rider. This covers your kids so that they do not have to pay premiums to sustain the policy, if the payer is unable to pay due to disability or demise.
With all this in mind, I believe you can start fishing. Gather opinions from friends and family as well.
watch out for part 3 we ll see the various types of child education plans and which insurance companies in Kenya provide them.
Authored by Sjam.
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