As per the last survey conducted in 2016, the education inflation stands in between 10-12 per cent in India. According to an article by the economic times, “the reports released by the National Sample Survey Office (NSSO) show that, between 2008 and 2014, the average annual private expenditure for general education (primary level to post graduation and above) shot up by a staggering 175 percent while during the same period, the annual cost of professional and technical education increased by 96 percent. The expenses typically include course fees, books, transportation, coaching and other related costs.”
If you didn’t get the numbers, an engineering course from a reputed private institution such as SRM or BITS, Pilani can cost you approximately Rs 16-20 lakh excluding the accommodation fees. If you consider that as well, you might end up paying a whopping 25-30 lakhs in four years for your child’s future. Having said that, if you didn’t invest in a savings scheme earlier, it might be difficult for you to pay for your child's higher education using your own income. But don’t worry! You can take a Personal Loan for higher education and meet the expenses.
1) Personal Loan for higher education: With a Higher Education Loan you can pay the tuition fees, the accommodation fees etc. Plus, you can claim the interest you pay towards the loan as a deduction while paying income tax.
2) Flexi hybrid Personal Loan: To be on the safe side and avoid making any compromises with your child's future, you can opt for flexi hybrid Personal Loan scheme by Bajaj Finserv. Applying for the said scheme will entitle you with a line of credit which would be higher than your borrowing eligibility. You’ll be able to withdraw the funds whenever you need and as much you need up to the limit. The best part, you can claim the paid interest as a deduction and you can choose to pay only the interest as EMI. This will significantly reduce the EMI size, and you can pay the principal component in the later years.
Source link: https://economictimes.indiatimes.com/tdmc/your-money/how-to-plan-for-child-education-expenses
Aman Khanna is an experienced financial advisor who is well known for his ability to foretell the market trends as well as for his financial astuteness. He has an MBA in finance from Toronto University as well as years of experience delivering seminars on sound financial practices and debt management.