Education Policy Plan for Twins

Policy Objective and Structure

• Goal: Accumulate funds to cover tuition and other schooling expenses from Grade 3 to university for both children.
• Duration: The policy will run for 20 years, with payouts aligned to their schooling milestones.
• Investment Growth: The funds will grow through safe, diversified investment vehicles to maximize returns while managing risks.
• Projected Benefits: Through consistent contributions, the plan will build a substantial fund, providing financial security for both children’s complete educational journey.

1. Payout Schedule

• Grade 3-12: Partial payouts at key stages, such as transitions to Grade 3, Grade 7, and Grade 9, ensuring funds are available for periodic school fees, books, and extra activities.
• University: Major payouts at the start of each university year to cover tuition, books, housing, and living expenses.
• Emergency Fund: A small portion of the accumulated funds will remain accessible for any unplanned education-related costs.

3. Investment Strategy and Growth

• Monthly Contributions: 50,000 KES will be invested in a combination of high-yield, low-risk assets, including bonds and managed funds.
• Projected Returns: An estimated annual return of 7-10%, based on current market rates, which may vary. This allows the policy to accumulate significantly over time.
• Risk Management: The plan will be reviewed annually to balance and optimize the portfolio based on economic conditions, ensuring a stable growth path for the educational fund.
• Policy Benefits and Flexibility

1. Tax Advantages: Monthly premiums are eligible for tax relief, maximizing your savings potential.
2. Adjustable Payouts: The plan provides the option to adjust payout amounts as educational needs arise, catering to changing school or university expenses.
3. Coverage for Unforeseen Events: In case of unforeseen circumstances, such as the policyholder’s demise, the plan ensures that premiums are waived, and the educational fund continues without interruption.
4. Bonus Additions: Performance-based bonuses will be added to the fund annually if the investment exceeds projected growth, further enhancing the overall fund.
5. Additional Features and Peace of Mind

• Dedicated Advisor: A financial advisor will work with you to review the policy periodically, adjusting it as necessary to meet the children’s educational needs.
• Security: With this policy, your children’s education is secured regardless of any future financial uncertainties, giving you peace of mind.
• End-of-Policy Payout: Any residual funds after university education are completed can be directed toward your children’s post-graduate studies or their early adult life goals, such as starting a business or other professional endeavors.

Plan Outline and Specific Payouts

This education plan is designed with structured payouts at key educational milestones to support school fees and other expenses as the twins progress from primary school through university.

Investment Assumptions

Monthly Contribution: 50,000 KES

Annual Growth Rate: Estimated at 8% (this is an average projection, which may vary based on actual market conditions).

Policy Duration: 20 years, aligned with their journey from Grade 3 through university.

With these parameters, let’s estimate specific amounts at critical educational stages.

Projected Payout Schedule

1. Grade 3 (Year 5 of the Policy)

• Accumulated Fund: Approximately 3,500,000 KES
• Payout: 700,000 KES (20% of accumulated fund) for Grade 3 school fees and other educational needs.
• Remaining Fund: After the payout, 2,800,000 KES will continue to grow for future educational expenses.

2. Grade 7 (Year 9 of the Policy)

• Accumulated Fund: Approximately 7,000,000 KES
• Payout: 1,400,000 KES (20% of accumulated fund) for Grade 7 school fees, books, and extra activities.
• Remaining Fund: 5,600,000 KES retained for ongoing growth and future educational stages.

3. Form 1 – High School (Year 11 of the Policy)

• Accumulated Fund: Approximately 9,500,000 KES
• Payout: 2,000,000 KES (20% of accumulated fund) to cover high school fees.
• Remaining Fund: 7,500,000 KES left to grow for future payouts.

4. Form 4 – End of High School (Year 15 of the Policy)

• Accumulated Fund: Approximately 14,500,000 KES
• Payout: 4,000,000 KES (30% of accumulated fund) to cover final high school expenses and prepare for university.
• Remaining Fund: 10,500,000 KES will continue growing toward university fees.

5. University (Years 18 to 20 of the Policy)

• Accumulated Fund: Approximately 18,000,000 KES at the start of university.
• Annual Payouts: 4,000,000 KES per year over four years to cover university tuition, books, and living expenses.
• Total Payout for University: 16,000,000 KES over four years, ensuring comprehensive support for both children throughout their higher education.

Summary and Additional Benefits

This plan covers school fees comprehensively from Grade 3 to university. By adhering to this structure:

School Fees and Expenses: All key educational stages are funded, reducing financial pressure each time your children transition to a new level.

Flexible Withdrawals: If any adjustments are needed (e.g., increased fees), withdrawals can be reviewed based on the policy’s accumulated fund growth.

Protection Clause: In case of unforeseen circumstances, premium waivers ensure the policy continues to support your children’s education.

This plan ensures that with your monthly contribution, the twins’ educational journey is fully supported up to and including university.

Key Features of This Education Policy

Structured Savings for Education: It builds a fund specifically for school and university fees, allowing you to plan ahead for critical educational milestones.

Periodic Payouts: Payouts are structured around key stages in the child’s academic journey, such as transitions to primary, high school, and university.

Growth-Driven Investment: Monthly premiums are invested to grow the fund over time, allowing for inflation-adjusted payouts when school fees are due.

Guaranteed Continuation: In case of the policyholder’s untimely demise or inability to pay, the policy often includes a waiver that continues the fund for your child’s education without interruption.

Flexible Adjustments: Most education policies allow adjustments to cater for changing education costs, ensuring that the policy remains aligned with future educational expenses.

With a monthly contribution of 50,000 KES, this education policy is designed to grow sufficiently, ensuring your children’s school fees are covered all the way through university.

“Secure your child’s future today with a comprehensive education plan! At Tamara’s Financial Planning and Consultancy, we are dedicated to helping you invest wisely for your children’s education journey, from primary school to university. Let’s walk this financial journey together to give them the best start in life.

Contact Tamara’s today to start building a brighter future for your family!”

Tamara’s Financial Planning and Consultancy
Empowering your financial future, one plan at a time.