Engineering will cost ₹15–40 lakh by 2035. An MBA could cross ₹50 lakh. A child plan ensures your child never has to compromise on their dreams — no matter what happens to you.
A child plan is a life insurance + investment product designed specifically to build a financial corpus for your child's future milestones — education, higher studies, marriage, or starting a business.
It has two powerful features: a life insurance cover for you (the parent) and a savings/investment component that grows over time. If something happens to you, your child still gets the full planned amount — the insurer continues paying the premiums on your behalf.
Think of it as a "guarantee" that your child's dreams will be funded even if you are not around to fund them.
Understanding the mechanics helps you plan better for your child's future.
You invest a fixed premium annually (e.g. ₹50,000/year) for 15–20 years. The earlier you start, the bigger the corpus due to compounding.
Your premiums are invested — in debt funds (traditional plans) or equity/debt mix (ULIPs). Returns compound tax-free over the policy term.
If you (the parent) pass away during the policy term, the insurer waives ALL remaining premiums. Your child doesn't pay anything more.
Once the child turns 18, you can make partial withdrawals to fund college fees — without breaking the whole policy.
At the end of the policy term, the full accumulated corpus (principal + bonus/returns) is paid out — tax-free. Use it for higher education, marriage, or business capital.
Choose the type that matches your risk appetite and investment goals.
Unit Linked Insurance Plan. Your premiums are split — one part goes to life cover, the rest is invested in equity or debt funds. Returns are market-linked and depend on fund performance — not guaranteed. Best for 15+ year horizon. Past performance is not indicative of future returns.
Guaranteed returns + life cover. The insurer invests conservatively and gives you a guaranteed sum + bonus on maturity. Lower returns (5–6%) but completely safe. Best for risk-averse parents.
Survival benefits paid at regular intervals — typically when the child turns 18, 20, and 22 (for education milestones). Balance paid as maturity benefit. Ideal for parents who want regular payouts.
₹8–12L today will cost ₹35–50L by 2035 at 10% education inflation. Start saving ₹40,000/year now.
₹3–5L today but competition is high. Even if your child gets in, living expenses, books, and coaching add ₹10–15L more.
IIM fees are already ₹20–25L. Private B-schools charge ₹8–15L. By 2035, plan for ₹40–60L.
Average Indian wedding costs ₹15–25L today. With inflation, plan for ₹35–50L+ by 2035–2040.
The biggest mistake parents make is waiting. I've met parents who said "I'll start a child plan when my child is 10." By then, they've lost 10 years of compounding. If you start a child plan when your child is born, ₹3,000–5,000 per month is enough to build a ₹1 crore+ corpus by age 18. Wait till the child is 10, and you need ₹12,000–15,000 per month for the same target. The second biggest mistake: not adding the Premium Waiver benefit. This is the most important rider in a child plan — without it, if something happens to you, the policy lapses and your child gets nothing. Always add this rider.