How to save for your children's education - Financial Planning
Date posted: 12 Aug 2014
As a parent, you want to provide the very best for your children, which includes giving them a good education. Unfortunately in South Africa, the cost of a quality education can run into hundreds of thousands of Rands – a sum that cannot easily be absorbed into a monthly or yearly budget. For this reason, as a parent you’ll need to plan very carefully for your children’s education.
Thankfully, a range of investments and saving solutions aimed at helping you cover the cost of your child’s education can help you to save, without putting huge strain on your finances.
The true expense of your child’s education
Although school tuition can be hugely expensive, fees are not the entire expense. Many parents don’t realise that the cost of a school education entails much more than just the monthly fees. Your child will also need books, stationery, uniforms and sports gear throughout his or her years at school.
If your child goes on to university, college or technikon, the cost of their education is likely to soar. Tuition fees at tertiary institutions are usually more expensive than school fees – except if your child is at a private school already. Along with annual fees, you’ll also have to consider associated costs such as textbooks, computer hardware and software and living expenses such as accommodation. You may also be footing the bill for petrol costs, spending money and various other necessities that your child is likely to require throughout their time as a student.
How to start saving for your child’s education
To start saving for your child’s education, it’s a good idea to sit down with your financial advisor and think about your child’s complete education needs. Consider the following points:
· How old is your child?
· What year will your child start school?
· Do you intend to send your child to a public or a private school?
· What year will your child begin his or her tertiary education?
· Do you think your child will require post-graduate studies?
· Will your child live at home or in residence during his or her studies?
By taking into account your child’s age, and the years in which he or she will begin school and start tertiary education, your planner will help you to determine how much you need to put away each month.
Timing is everything
As with any type of savings or investment policy, the earlier you start saving for your child’s education, the more affordable it will be. It’s never too early to start: whether he’s only just begun to take his first steps, or she’s just given Daddy her very first smile, the sooner you start planning for your child’s education, the more you’ll be able to provide for your child.
Hollard is a leading South African financial services and insurance provider, offering a range of savings and investment plans to help you accumulate wealth. Speak to our financial advisors today to start an affordable education plan for your child.