Guiding principles for your children’s future

The first guiding principle should be that of adequate insurance. Any long-term plan needs to necessarily leverage on future resources. At the same time it needs to ensure that the process of planning your children’s future does not get endangered in the event of any exigency. This necessitates that the person whose resources are being leveraged in the plan, is adequately insured so that the plan continues smoothly even in his / her absence. It needs to be remembered that the overall resources net of liabilities should be sufficient to fund the plan. 

The second guiding principle revolves around structuring of the plan. With the rising costs of education, the requirement of funds not only arises earlier but also arises more periodically. The cash flows from the children’s plan should be structured in a way that either there are a series of regular cash flow from the investments or the plan has an inbuilt borrowing facility which can be drawn upon.