Practical Ways To Save For A Child’s Education

What are the practical ways to save for a child’s education? Fees seem to be immune to the economic situation in the Country.

Expenses are increasing, news about the economy is not encouraging, earnings have reduced and money can buy much less. If you are in Nigeria today these are the majority of the sentiments that are going around and the real situation in most homes. Some situations seem to be immune to these problems – one of them is your child’s education.

For the average parent no matter where they need to tighten their belts, their children must still get an education. Perhaps the choice of school that you can afford might change, but in reality school fees still need to be paid.

In all of history this story of foreign exchange, increased inflation and expenses come and go. It is the same script just different times. I remember when my brother was getting ready to go to University and the exchange rate went from 1 to 20, to 1 to 80! The effect then too was massive and lots of families and homes had to make adjustments. I have had the opportunity to speak with many parents and read examples to find out what the best ways are to stay ahead of all the ups and downs.

save

Practical Ways To Save

1. Plan Ahead – While this seems so simple when it is said, the reality is that this one singular act of saving and planning ahead is the best way to build the security you need. Imagine if you start saving for a child’s university education from birth, then you could have about 16 years to save. Add on top of this the effect of appreciation and compound effect and you would have built up a nice amount for higher education. Below are some examples of Invesment products –

  1. FCMB Educational Plan – The plan is a convenient and secure way to save for a child’s university education, in the USA, UK, South Africa, Ghana and Nigeria. The product aims to help parents and guardians build up a lump sum by investing periodically into an investment fund, the bank will pay out the amount when the plans end. Initial minimum deposit range from N50,000.00 to N250,000. You can calculate how much you need to save here for the future. 
  2. AXA Mansard EduPlan Plus – This plan allows you to build up funds over a period of time to finance the education of a child. It also provides financial protection for the child’s education in the event of the demise or permanent disability of the policyholder.
  3. Mutual Funds are a good way to invest for the future – ARM Mutual funds are good if you are looking to build an “egg nest” for the future or If you can only invest a little at a time and want to contribute regularly.

2. Save – Getting into the habit of regular savings helps you to save for a rainy day. Several institutions allow you to do automatic deductions to a savings account. You can also open an education fund which serves as a savings account for your child’s education. For example 529 plans let you save on a monthly basis towards the education of your child. These are usually tax free when you need to access the funds at the end of the peropd. I personally use Vanguard
3. Invest – Invest in assets such as real estate, both local and internationally. Real estate investment are a great source of wealth creation. Rental properties can yield regular income from rent.

  • Investing in Real Estate with a reputable firm is advisable. A real estate portfolio with investments including plots for future development, retail and residential are a great way to diversify. Real estate for the long-term should focus on areas ripe for development and buy now. Visit Pekuliar Properties for more information or call 0803-978-6069 for more information on real estate investments.

4. Scholarships – It is never too early to start to think of how your child might get a scholarship to cover tuition. Scholarships could be either based on academic performance or skills and talents. A mentor told me that her children got musical scholarships to attend top schools in the UK and since then I have taken my children’s music lessons very seriously! Start now, find out what they might be interested in and start to expose them to being world class. They just might be able to access a scholarship in the future. Want a list of some potential scholarship opportunities? Here is a link to give you an idea of what is available.

Children will be born and they will need to get educated. Strategically planning would enable you to make the cost of educating your child or children more manageable. Get a head start now by taking a few steps to save money before it is needed.

What is it about LagosMums? Being a Mum means that you are many things at the same time…

FOLLOW US ON