Education policy vs fixed deposit...just wondering which is the better option...

if the option is to get a fixed deposit....which bank offers good interest rates for fixed deposit

See below a quote i got from ICEA education policy...

2 plans running concurrently for high school and campus education.
one to mature when the child is joining form one and to pay every year till the child clears form 4,and the other now to mature when the child is joining campus and to pay cheques every year till the child clears form 4.now minimum premium per policy plan is ksh4000.so that will require a total premium of ksh 8000.
Then to keep up with inflation and rising school fees you need to be increasing the premium every year by at least 10%,escalation factor.so if this year your premium is 8000,next year its 8800,year 3 is 9600,year 4 its10,648 then year 5 its 11712.
5th year,policy 1 matures at this point so you are left with one plan but you proceed with it at that premium level,so that it generates enough money to pay for campus since that is quite high.it matures the 8th year

Help me make this decision .......

Thanks

Prosnl advice from ins ind pls always think security while taking cover so do all other invstmnts but have a policy for security they are not substitudes unless u are certain of when ur life may end or any unftnt ocrnce eg acc.

Dignityis everything keep it intact

@Crl:

The 'I' in ICEA stands for INSURANCE,not investment.

So if you want insurance,go for the ICEA plan; but if you are looking for investment,go the fixed deposit rout.

Insurance and investment serve different purposes.

In insurance you inject small amounts over an agreed duration of time,at the end of which you get the agreed return. If you die at any point AFTER signing the agreement,your beneficiary will still get the full matured sum at the end of the egreed period...even if you are knocked dead by a car when leaving the insurance company's office after signing the first cheque!!!!

In Fixeddeposit investment,you only get the principal invested plus interest earned as at the point when you withdraw your money.

Now decide what you want: investment or insurance


Behind the gardens...Behind the wall...Under the tree (Including: Red...Dark Blue...Yellow)

Furthermore.....

In an insurance policy,the escallation principle is a falacy!!! Inflation is taken care of by the interest earned plus so-called bonuses.

For an education policy,the 'sum-assured' should be equal to the present day total fees [for the whole programme - e.g.,cost of Form 1 to 4] of the [kind of] school that you wish your child to attend in the future.

The truth is that school do not increase by very big amounts. Real example: for years ago my son started in a private school whose fee were sh18k per term. My daughter will go to the same school next year and fee is now sh21k.

This works to 4% pa; and this is a good school with very high demand! I am yet to see an educational institution whose fees have been increasing at an average of 10%pa over the last 10 years.




Behind the gardens...Behind the wall...Under the tree (Including: Red...Dark Blue...Yellow)

If you decide to go the fixed deposit route,talk ti I&M bank about their 'Recurring Deposit' account....but don't expect big returns with any fixed deposit account...you will be much better off keeping the 8k per month for 6months and then buying the KenGen PIB from the secondary market

Behind the gardens...Behind the wall...Under the tree (Including: Red...Dark Blue...Yellow)