Best Ways to Invest in your Child’s Education
“Education is a shared commitment between dedicated teachers, motivated students and most of all, enthusiastic parents with high expectations.” - Bob Beauprez
Raising children is one of the toughest jobs that you can ever do. As soon as that little human enters your world, various dynamics of your world shift to fit the needs and wants of your child. You want to be sufficient enough to be able to fulfil all your duties as a parent to the best of your ability. One of the primary duties is to partake in the process of educating your little one.
With inflation at an all-time high, education is at the costliest it has ever been. In such situations, you only wish to have saved enough to be able to invest in your child’s education with a carefree mind. If your child is merely a fragment of your thought process, there is still time left for you to work towards that goal.
In order to provide the best you need to plan for the best, and here the best route to take is to invest for your child’s education. The potential that your child could posses is innumerable, why limit them by not planning for their dream education early on? Having a child plan would allow you to explore various options, and pick the one that is most suitable for your child.
Here are a few steps to take to ensure a stable education for your child:
Taking stock of what you currently possess
Having a sense of the kind of approach you need to take to yield the most beneficial result is extremely important. It will allow you to have a clear goal in mind, keeping a note of all the shortcomings that might come along the way. Knowing how much you currently have to fund your child’s education, and whether or not your funds will be able to support the level of luxurious education that you wish for your child.
You have to ask yourself the tough questions- Am I okay with my child studying in an x level of school? Will my child want to study abroad? If yes, will I be able to support them? Confrontation with yourself regarding your finances is what will get the wheels turning. The sooner you give the subject of education a thought, the smoother the process could be, potentially.
Never too early to start
Education is a long-term goal. Saving for it can never start too early. All levels of schooling cost heavily on the pocket nowadays. If your child enters college at the age of eighteen, that will allow you almost a period of two decades to save enough to not have to compromise. Small monthly contributions to your savings, investing in the right places can allow you to attain that liberty in a smooth fashion.
Yes, inflation is very real
Higher the inflation, the more the cost of education. People tend to overlook the aspect of inflation when planning for any kind of future investment. To avoid that mistake, conduct enough research to understand how inflation can affect your goal of giving premium education to your child.
A business course, in India, which cost 8 lakhs in 2008 now costs over 20 lakhs- making the raised cost at 13% on an average. That same course would, accordingly, cost close to 70 lakhs. While assessing the cost of education, calculating the rise and fall of the value of money is of paramount importance when constructing a child plan in India.
Keep your ROI in check
Your child’s education is an overtime process that you will have to invest in for a stretched period of time. In the planning process, it is highly recommended that you invest in places with moderate level risks that produce long term, high returns. With high reward long term plans that are least affected by the fluctuations in the market and emerge along with the desired corpus in the decided time frame. Investing in a moderate risk plan with some return is better than investing in a high-risk plan and not getting any return.
Investing in a child plan will allow you to weigh in on the various factors that could have an impact on the education of your child.
Start small, dream big
Astronomical money requirements can be daunting, but if you invest towards a goal then the implementation of the stepping up process could come in handy. This process requires you to increase your savings percentage as your salary grows. For example, if you earn 50,00 rupees now and save 10,000 then accordingly when you get a hike of 10% in your next job, your savings should also increase by the same percentage. Taking these small steps will allow you to kickstart the growth of your savings along with your income.
Paving the path for your child to be educated in the best possible manner is a priority for all parents. Education can be a long-running subject, as it is an investment that builds your child’s future. Futures cost heavily on the pockets of parents, but having to compromise on them due to lack of planning costs more heavily.