Child Education Planning: Start with ₹1,000/Month

Every parent I meet in Gorakhpur has the same worry: 'How will I fund my child's higher education?' Engineering costs ₹8 to ₹20 lakh today. MBBS in a private medical college is ₹50 to ₹80 lakh. These numbers are frightening, but they become manageable if you start early.

The single most important principle in child education planning is time. Starting when your child is born versus starting when they are 10 years old makes an enormous difference. Here is the math.

If you invest ₹1,000 per month in an LIC endowment plan (like LIC Jeevan Tarun or LIC New Children Money Back Plan) starting when your child is born, by the time they are 18, you will have accumulated approximately ₹5 to ₹6 lakh (depending on bonuses). This will not pay for an MBBS, but it covers a significant portion of a bachelor's degree in engineering or commerce. If you increase this to ₹3,000 per month, the corpus grows to ₹15 to ₹18 lakh by age 18, enough for most undergraduate programmes.

LIC's child plans have a built-in waiver of premium benefit: if the parent (proposer) passes away during the policy term, LIC waives all future premiums and continues the policy until maturity, paying the child the full sum assured at the scheduled date. This is the key advantage over a mutual fund or fixed deposit for education planning, the insurance component ensures the goal is met regardless of what happens to the parent.

Beyond LIC child plans, a term plan for the parent is equally essential. A ₹50 lakh term plan costs approximately ₹5,000 to ₹8,000 per year for a 30-year-old. If something happens, your child's education fund does not disappear, it is replaced by the term plan payout.

For a family with a newborn: I recommend LIC New Children Money Back Plan for ₹1,000 to ₹2,000 per month, combined with a ₹50 lakh term plan for the earning parent. Review the education corpus every 3 years and top it up as your income grows.

Start today. Every month of delay costs more than you think. Call 9415313434 for a personalised education planning review.