Saving for your child's education now can save you from a rainy day. Page Financials has put together a guide to help you get focused and save for your child’s future.
Having young children is expensive and trying to put money aside while you pay for everyday expenses such as childcare can be really difficult. Also, education costs can seem very far off, especially if your children are very young. Planning and saving for your child’s future education however, while they’re young, will help take the pressure off you in the years ahead.
The only real legacy you can provide for your children in order to help them through the challenges of life is a good education – make sure that you start early enough to ensure that this becomes a reality for them and for you.
We have put together a guide to help you get focused and save for your child’s future:
See what you can afford to save
Take time to see what you can afford to save. To help you see where you’re spending your money, look back at your bank statements, credit card statements, bills and receipts. Use a budget planner to help you compare what you are spending your money on to your income. This will give you a realistic idea of what you can afford to save.
The best time to start saving for your child’s education was 5 years ago. The next best time is now – even if you don’t have a child yet.
Rather than buying big Christmas gifts or birthday presents, put some money away on a regular basis – it could be daily, weekly or monthly towards your child’s education.
Set up a target savings account
Setting up a target savings account when your child is young means that you have a number of years to build up your savings. When working out college costs, you should factor in rent, transport, books etc. Look for an account with great interest rates such as the Page Target Savings Account where you can put away money for your child’s education.
Review your budget regularly
It is worth reviewing your budget regularly as your financial situation may change. For instance, you may get a pay rise which may allow you to save more. This also applies if your earnings decrease and you can’t save as much. Don’t be discouraged and stop saving altogether if this happens, even a small amount each month will eventually build up.
Invest in your own name
Whilst it is your child that will ultimately benefit from your prudent savings, it is your money and you should exercise whatever decisions that need to be taken to make it work for you.
A lot of people prefer to invest money in the child’s name, but it is important to keep in mind that once the child turns 18, he or she can technically use the money for anything – not only for tertiary education.
Make your contributions automatic
Ask your financial institution to set up automatic, direct debits from your salary account to your Target Savings Account. This way you don’t have to put in any extra effort into ensuring you are making regular contributions to saving towards your child’s education.
Set up a trust
A trust, a legal agreement where money is transferred from one person to another according to specific terms, is a good way to "manage, control and protect funds" because it gives a parent – or grandparent – the peace of mind of knowing that the money will be used for its intended purpose. It is important to set up the trust properly with a written agreement that outlines terms and conditions.
Encourage grandparents, godparents and other family members to add their contribution to the plan, in place of gifts at Christmas, birthdays and other events. Suggest to grand-parents and god-parents that the best legacy they can offer your children is a contribution to their education.
Engage your children
Your children should have an understanding of the importance of financial planning. Let them know what their education expenses demand, giving them the opportunity to become more involved and even eager to save for their education by themselves as they grow older.
Choose your child’s school wisely
In choosing where to send your kids to school, ensure you choose a good school that fits into your family’s earning income.
Take advantage of Page Financials School Fees Loan. You can get up to N2,500,000 School Fees Loan to fund your child’s education.
Start a savings culture, click here to save for your child's education.
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