"Education is irreplaceable. Regardless of affluence or scarcity, presence or absence, you can delegate the financial risk of your children's education to an insurance entity." When these words echo forth from insurance agents, numerous parents find themselves instinctively reaching for their wallets. In recent times, the notion of "education gold insurance" has gained remarkable traction. Yet, amid the façade of this alluring promise, lies a stark reality: while the concept may seem robust, its actual implementation is lackluster. What precisely does the education gold product propagated by insurance agents entail? What manner of insurance is indeed essential for your child? Refrain from parting with your funds hastily, and seek comprehensive understanding before making any commitments.
First and foremost, why does education insurance epitomize a substantial swindle? To illustrate, consider an insurance policy valued at 100,000 yuan, promising annual returns of 25,000 yuan over four years of college education. Upon reaching the age of 25, the child is bestowed a starting capital of 50,000 yuan. The aggregate premium amounts to approximately 890,000 yuan, averaging 4,500 yuan annually. However, this ostensibly promising product is, in essence, a financial insurance; its veneer of education-related pertinence is purely superficial, existing solely to captivate consumers.
Dissecting this category of product reveals a typical configuration composed of two constituents: one pertains to life insurance liability, and the other to the annuity return. Regarding life insurance liability, the focal point of education insurance often rests upon life insurance coverage. Yet, insuring the child constitutes an inherently futile endeavor. If the child is nonexistent, the notion of education becomes moot. Who among parents would necessitate indemnification for an absent child? The rationale underlying our need for life insurance as adults lies in our duty to provide for our offspring. Children lack a source of income and are devoid of the responsibility for sustaining the family's foundation. Thus, the life insurance component of education insurance emerges as superfluous. As for the annuity return facet, due consideration must be accorded to its authentic rate of return. Generally speaking, dividend-based products offer returns scarcely distinct from savings income—approximately 3%. Such a rate of return pales in comparison to the utility of placing funds in a bank account, enabling accessibility during emergencies, or opting for fund products that yield superior returns. Moreover, the implications of inflation and currency depreciation should not be overlooked. A mere 18 years ago, university tuition stood at a mere two or three hundred yuan annually; at present, a minimum of 10,000 yuan is requisite. Consider this: if I were to invest in an education insurance policy like "Little Sun" today, 18 years hence, the insurance company would remit 50,000 yuan. Can such an amount genuinely defray the costs of a child's education? Admittedly, it might offer some alleviation, yet the reality remains—it's a pitfall. One might inquire as to why insurance companies are inclined to devise and market such a seemingly "futile" product. The fundamental motivation is—exorbitant profit! To illustrate, the current quasi-savings interest rate for money market funds is 4%. Should an insurance company design an annuity insurance product yielding a paltry 3% actual investment return rate, the insurance entity could effortlessly net 1% of the aggregate, akin to an unproductive endeavor. Should the insurance company's investment channels yield returns surpassing 4%, while customers' actual investment returns languish beneath 3%, the potential profits for the insurance company become incalculable. Consequently, for the typical wage earner, how might one genuinely secure their child's future? The most dependable course entails reverting to familial realities and embracing a strategy that contemplates matters "from end to beginning."
