As a parent, your child’s health, safety and happiness are your priorities. As a result, you begin to plan your child’s future the moment you find out you are going to have a baby. Planning your child’s future is a very important role that you play as a parent.
Children have big, fluid dreams - they want to be a doctor one day and a pilot the next. Whatever their dreams are, your support plays a huge part in fulfilling them. Here’s how:
1. Planning Your Baby’s Arrival
It is important to start planning your finances before the arrival of your baby. Anticipate the medical costs you will bear during pregnancy and after - this could be anywhere between Rs 30,000 to 1 lakh, depending on your birth plan, choice of hospital. You must also plan expenditure that you will regularly make to support your baby’s overall growth. For example, your baby needs approximately 2,700 diapers in just the first year, and this could amount to around Rs. 20,000-25,000 a year on diapers, and around half that amount again on vaccinations and emergency health care.
Taking inventory to know where you stand financially, as well as setting money aside for your little one’s early years is important. Saving even around just Rs. 2,000 a month before your baby arrives, can go a long way when your baby does arrive.
2. Planning In The Long Term
Once your baby arrives, you should begin to anticipate long term futures - like their higher education. Raising a child until the age of around 21 years can cost the average urban Indian around Rs 2 crores. Anticipate this, keeping in mind where the expenses center in these years. Before the age of 4 years, health care is the highest expenditure, whereas after the age of 17 years, education becomes the center of your financial planning.
It is important to start building assets at soon as possible, so that you are prepared to start supporting your child when they begin to chase their dreams. A few investments before your baby is born, for example, can build up over time and help fund a part of their educational costs.
This is especially important because the costs of education and child care rise on a daily basis, and building up savings and assets can help you cope with this in the long term, especially acting as a financial aid during your retirement.
3. Securing Their Future
Investing your savings wisely can pay off in the long run, as they help you expand your assets over time. Big dreams require enough funding, and with the rising costs and inflation, it can be difficult to support your child’s dreams unless you are financially secure. These assets can be a great fall-back when your child, years down the line, decides on a dream to chase after.
HDFC Life’s Click 2 Invest ULIP plans allow you to make considerable returns by investing your savings. You have the flexibility to choose your policy term, as well as a variety of plans, which will specifically be tailored to meet your goals, and your child’s.
Keeping your child’s dreams safe starts today. Making wise decisions, and focusing on savings and assets can make a huge difference to the way you support your child financially.