Have you planned for your children's education fee's?
Children’s education is a top priority for parents all around the world today. With ever-increasing costs of education making top universities almost unaffordable, most parents are concerned about their children’s future. Many fear their children’s education might be determined by the available budget rather than merit and ability.
Although we cannot control the rising education fees, by planning our children’s education in advance we can prepare ourselves for the financial impact when the time comes.
Education fee planning – long-term saving and investing specifically designed keeping in mind children’s education requirements – allows parents to address these financial concerns and secure their children’s future.
Education fee planning is not complex; however, you need to have a good understanding of the various savings products and options available in the market in order to make an informed choice. Without planning for the fees in advance, affording quality education for your children can become a financial challenge that may necessitate taking on debt and costly student loans.
Identify the cost of sending your child to the university
Graduate-level education at a good university / college nowadays costs around ￡25,000 to ￡60,000. You will need to identify the universities and colleges your children are most likely to choose and take into account the fee structures. Also, add the average living expenses for the duration of the course and factor in the average inflation per year for every year until your children are ready for admission.
Set a realistic savings target
Once you have identified the costs, set a savings target that takes into account your financial situation, including any debt, assets and investments you may already have. If you have 18 years to plan for your child’s education and save ￡170 per month at an annual return of 5%, you would generate a pot of ￡60,000 (before costs and tax). If you don’t have 18 years and cannot save that much, you need to look at other investing vehicles that offer a higher rate of return.
Consult an expert
An independent financial adviser can guide you in your efforts to save and invest for your children’s future. With a range of financial solutions available in the market, an adviser can make the best decisions for you and periodically review your savings plans and investments for optimum returns.
For more information on Education Fee Planning, including information on university fee structures in various countries, download our Education Fee Planning Guide. If you wish to seek advice from a professional regarding your children’s education fee planning, please contact me at [email protected]