Any parent’s primary goal is to give their children the best learning and development opportunities possible. As a result, steps to build a solid child education plan are necessary. When your child is ready for college, you will be financially prepared and not scared by the high cost of education. Here are some fundamental steps to take when setting up an education fund for your child. It’s only natural for parents to have hopes and dreams for their children’s futures, whether those hopes and dreams are trivial desires, education, or marriage. Indeed, we Indians are so committed to the adage that “education is insurance” that we are willing to forsake shopping and outings to save for our children’s education.

However, given our country’s low financial literacy and well-documented financial product mis-selling, many of us running out of money wouldn’t be surprising. This will be the scene of our next horror. We will exhaust our retirement fund if we dip into our savings (as many of us do), decreasing our standard of living in retirement and potentially becoming a financial burden on our children.

PPF, Kisan Vikas Patra (KVP), National Savings Certificate (NSC), and bank fixed deposits all provided a good return on investment at one time. Even with rudimentary planning, parents could make ends meet in terms of financial planning for their children’s future requirements. These classic items’ rates of return have slowly declined over time, especially as inflation has caught up with them. Let us read about the steps to build a solid child education plan.

Steps to build a solid child education plan

Below mentioned are a few steps to build a solid child education plan:

  1. Do not squander any time

Saving for your child’s education is a long-term financial goal. When your child is born, it is the ideal time to start thinking about his or her long-term requirements. If your child starts college at the age of 18, you’ll have nearly two decades to save enough money to cover his or her expenses. Compounding growth will allow you to achieve this goal with only a few monthly payments.

  1. Make sure to account for inflation

Inflation makes higher education more expensive with each passing year. In 2018, the fee of a prestigious business school’s flagship two-year degree was raised to Rs 21 lakh. In 2008, a similar program cost Rs 6 lakh. As a result, the price has climbed at a rate of over 13% every year. The same course might cost Rs 69 lakh in 2028, assuming the same rate of inflation. When determining your child’s educational financial needs, it’s vital to include future school expenses.

  1. Low-return investments should be avoided

Children’s education is usually a long-term goal, and there is a lot of cost inflation, as the following example indicates. As a result, you should put your money into securities that outperform inflation. With a long investment horizon, you can take minimal risks while still making significant long-term rewards.

For example, 10-year stock mutual fund returns are 11.80 percent, much above inflation, and returns on small savings accounts like PPF are likewise well above inflation. With a long-term investment plan that includes high-reward assets, you can recover from periodic market turbulence and emerge with the necessary corpus in the shortest time possible.

So, if you wish to invest Rs 50 lakh over 15 years, you can either invest Rs 10,000 each month at a rate of 12 percent or Rs 15,500 at a rate of 7 percent. The first option is the more cost-effective option.

  1. Begin with a little project and work your way up

The large financial requirements are easy to be scared by. When investing in any goal, though, you should employ the notion of ramping up. Let’s say you make Rs 50,000 today and save Rs 10,000 per month. If your income increases by 10% to Rs 55,000 the following year, you should increase your savings by 10% to Rs 11,000 the following year. You can start with small steps while your income is low and work your way up to greater steps as your income improves while increasing your investments year after year.

  1. Make certain you’re protected

Life insurance should be considered as a safety net for your family first and foremost, but it is also often used as an investment. In the event of your untimely death, your life insurance should help replace your income, keep your family financially afloat, and help your children achieve their life goals. You should have enough life insurance to cover at least 10-20 times your present annual pay. With a term insurance plan, you can meet this coverage need and offer financial security for your family even if you die.


This is far more crucial for girls than it is for boys because girls are often more constrained and have fewer options, which can lead to lower expectations. But, at least in part, this can be addressed by providing information about how markets work. According to studies, women who were shown films of other women working in traditionally masculine industries such as auto repair and told that the pay was higher in those disciplines were more likely to choose and enroll in training in those historically male-dominated fields.

When it comes to females’ education, there’s nothing wrong with picturing primary schools. However, we must pay equal attention to what happens before and after primary school in order to assist girls to flourish in life. In the twenty-first century, girls and young women entering the labor market will need skills and information that can only be learned over time. At all the steps to build a solid child education plan, they need our help. Please refer to Welfin and solve all your queries related to the child education plan.

Leave a Reply

Your email address will not be published. Required fields are marked *