Q :
I would like to set up a fund for the future education of my daughter, because she wanted to be a doctor . I ask , better join Insurance Education or Education Savings ? I also beg an explanation of the difference of the two investments. Thank you . ( Widi , 31 )
A :
Savings is to save products that can maintain the integrity of the initial capital . But , of course, certainly not high yield . Insurance is a financial protection products to protect the head of the family if the family income is the source of death or permanent total disability permanent . So , obviously , saving for saving , and insurance for protection.
Well , insurance education is basically a combination of term life insurance products (term -life ) plus savings . The main features of life insurance that will actually pay the sum insured if the insured dies before the child goes to college . Enhancements is to force you to save .
Of the balance of accumulated savings , the insurance company will spend some money at the time children enter elementary school , junior high , high school and university entrance . So , if you do not die until the policy ends , the child only gets a share of the savings in the form of the promised payment plus bonus if any .
Education savings is savings deposit product that usually lasts two years and above , where you have to deposit funds each month until maturity . Usually added benefit of life insurance features , so the savings will continue tersetor although parents died.
Based on the results of research conducted by the Research Division ZAPFIN , the average increase in the cost of education in Indonesia reached 15 percent per year . With these figures , it will be difficult if you have to set up education fund in the long run by saving the Education Savings only returns about 6 percent per year , and also insurance education actually serves to protect .
You need to invest to prepare for long-term education funding . Investment products such as mutual funds , is a product to double your initial capital more quickly because it can provide up to 20 percent yield potential per year . But , of course, the risk may be worth the investment to decline in the period .
Tips to prepare for education fund
Decide which school you want to target , calculate the current cost requirements . Do your research or ask your financial planner about this . Then , count the cost later needs to include inflation of 10-15 percent per year . You can use the help feature in the Education Fund http://www.zapfinance.co.id calculator to calculate .
Check back savings or investments you have prepared . If the funds are not enough or even not exist at all , now is the time to prepare .
Adjust the selected financial products with a term needs. Each financial product has a different character and function . For example , stock mutual funds could be used to meet the goals of the child ‘s college fund duration is more than 10 years from now , but this product is not suitable to meet the short-term education funding for children who will be 3 years college .
Buy pure life insurance protection , which will provide a guarantee if the head of the familydied and could not continue the investment.
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