With the cost of education rising, parents should take it upon themselves to plan and save in advance. But believe it or not, they will be bumping time to time into unforeseen expenses, which put a strain on parent’s pockets especially if they are not planned for.
This is the statement from South Africa-based, Ester Ochse, who is the Wealth and Investments product specialist for First National Bank (FNB).
The following is Ochse’s sound advice saving for your children’s education needs:
Start saving now
It’s never too late to start saving – for the short or long term. Be it for crèche, nursery, primary or tertiary education, you need to ensure that you save enough so that your children receive the best education possible.
Draw up a savings plan
A savings plan is your blueprint to your savings journey. This plan should highlight your aims, objectives and goals for the year. Review this plan on an ongoing basis and ensure that you stick to your objectives.
Goal-based planning that encompasses both short and long-term goals are important. These goals can help you understand what your priorities should be and where your focus should lie. These goals will help you manage your finances and at the same time ensure that you have enough for all your expenses, including emergencies.
Like a savings plan, you need a budget. Budgeting may be a tedious activity but can help steer you away from unnecessary spending and will help you keep track of your spending. In your budget ensure that you list your child’s education fees, uniform costs, stationery, extra-curricular, medical expenses, textbooks to mention a few. Do a comparison on a year-on-year basis and see if your expenses have increased or decreased.
Open a savings account
Look at opening a Savings Accounts or Unit Trust for your child. Look at the interest and return on investment when deciding on which account to open.
General school expenses
Day-to-day school expenses will not end and will add to your budget quite drastically. Many schools advocate that children need to partake in extracurricular activities like netball, chess, modern dance – but these activities come at a cost. Ensure that you understand what your child enjoys doing before enrolling them in a class. This will leave you with less wastage and with a happy child.
“Education is a must, and while school expenses are high, we should ensure that we save appropriately so that our children get the best possible education ever,” Ochse concluded.