investment planning for a child

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Posted by appa | Posted in finance | Posted on 20-03-2009

Following Maxim’s example, I felt that Abhinav should have a bank account of his own as well. Visited the nearby Canara bank and found that its quite easy to do so. And also found that there was a good policy (that would help me save some tax as well!). A parent could buy this insurance for a child, and pay x amount of rupees every year, and in the case of a death of the policy payer, then the bank guarantees that it will continue paying the same amount every year till the end of the tenure. The tenure is 10 years, after which the amount is locked and the profit invested within itself for another 10 years, so at the end of 20 years, the total amount which is quite a handsome sum is handed over to the child.

Of course I must’ve botched up the description… so better details from the site are here: Canara HSBC Oriental Bank of Commerce Life Unit Linked Limited Pay Endowment Plan. A bank account isn’t necessary for this, but we still want to open the account so that we can save money regularly and also save a bit of the premium there as and when we have the budget for it, so that the total amount is ready before its next due date next year.