Saving for Children’s Education

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Saving for child
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Saving for Childrens Education
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Parents want the best for their children and
education is top of the list of priorities with
many households. Many parents are turning to
private schooling over government schools as the
trust and confidence and quality of education is
found in the former. The question is, where do
you find the money to pay for private
education?I spoke to Jenny Crwys-Williams on
her show on Radio 702 this afternoon and we
uncovered some of the huge costs of Private
Schools. The Ridge in Johannesburg was one of
the most expensive at a whopping R60 000 per
year. The figures extrapolated to over R600 000
to educate a child to grade 7.  I was on
Midlands Meander at the time and passed by
Michael House so thought I would do some research
on the costs. Found the First year to be R206 018
with the Acceptance fee and Development Levy
included. 
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Be Realistic Realistically, parents do not have
much time to save. From birth to the first day of
school there are only 5 years or so and then
education costs cover the next 15 years plus. If
you decide to borrow money to fund education you
simply pay much more for it, so this is not the
ideal solution. The funding should come from
your monthly household income which means you
will need to balance your budget carefully and
honestly giving way to other living expenses the
more you allocate to education. Target a stage
of Education You could consider saving for child
madly from birth to grade 7 using the capital
that you manage to accumulate towards affording a
better secondary education.
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With the power of compound interest and saving
from birth through primary and secondary school
you could accumulate a substantial amount which
could help towards a better option for
varsity. Where do you save? There are many
investment vehicles which will help you save
towards education costs. Unit trusts, exchange
traded funds, endowment policies to name a few.
You should seek the advice of qualified financial
planner to help you choose an appropriate
option. One of the lessor considered options
for providing funding towards your education
costs is your access bond. If you saved extra in
your bond you immediately earn the same rate of
return that your bank is charging you. No costs,
no tax, no risk of losing capital and immediate
access to funds when you need them. 
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