Gone are the days of avoiding to invest for a child’s future education… Amidst these unprecedented times of rising living costs and educational inflation – the time has come to make wise investment moves.
Hello to an era where phrases such as “Did you hear how much that cost” and “How did you pay that?” echo in our minds! If someone in the early 2000’s said that in 2022 we would pay a staggering amount for children to have access to education, they would likely be institutionalised.
There can be no doubt that it will continue to rise in the years to come, and affect decisions regarding our children’s education. Whether it’s the affordability, quality, or the placement– the rising costs has brought about unprecedented changes.
You may find it challenging to set aside money every month to fund the studies of your child, but it will be worth it in the long run, especially in light of the escalating costs of educational expenditures.
Can online education be an affordable alternative?
There has been a surge in interest in online learning due to COVID-19 and concerns over rotational learning. Several prestigious schools now provide online learning, which is much less expensive than in-person education.
In spite of the significant savings on fees offered by online schooling, there is still education inflation every year to contend with.
This is set against the backdrop of rising inflation, as the annual headline inflation rate rose to 5.9% in December 2021 from 5.5% in November 2021. With an annual increase of 6.1%, this is the highest increase since March 2017.
It is important not to let short-term events affect your education investment, as it is a long-term financial goal.
Saving goes a long way
Even if you can currently afford your child’s primary school fees, this doesn’t necessarily mean you will be able to afford high school or university tuition in the future. In general, education costs are higher than the average salary and inflation in general, and you cannot rely solely on your salary to cover them.
For saving for your child’s education, a variety of investment accounts and policies are available, including education policies, unit trusts, and tax-free investment accounts.
Most parents find it difficult to take that first step towards saving for their child’s education. Not everyone knows the type of education they want and what they can afford early on. You’ll have more options later on if you start saving as soon as you can.
To ensure you’re following the right plan with the right tools, align your goals and timelines with your investment decisions.
By discussing your options with a financial adviser, you can learn about the available options, compare costs and forecast returns, and make a confident decision.