Are we able to assure that money is always with us when we need it the most ? Money is something that would come and go. A wealthy person today may lost part of the wealth due to economic crisis, just like Covid-19 pandemic. In fact, economic crisis do happened.
What’s our concern is, do you have enough money to continue paying for our kids education if unforeseen circumstances hits us ? If we don’t and our kids were force to stop their education, how would they feel ?
In fact, no matter how tough our time were, there are certain commitments that we cannot postpone. Unlike retirement planning, if we unable to retire at the age of 60, we can postponed it to 61,62 or 65. But if our kids reach certain age where they have to go to universities, we cannot tell them to hold on. We have to plan for it or else they would miss the chance to further their studies.
Besides, in order for them to have a good foundation in life is to provide them with a good education. With a good education, they would have more knowledge and life exposure, leading them with a great platform to start off to the real world.
What is education planning ? Education planning is setting aside certain amount of our income every month to pay for our kids higher education fees so that when they need to use it, we do not have to dig out from our current account or selling off our properties.
A lot of parents tend to buy property as a medium of saving for their kids education. But we have to be aware that property is not a liquid assets. We might not be able to sell off our property when we need it the most due to bad market condition, for example.
So the simpler way to build our kids education fund is to save aside 2-5 percent of our monthly income into an education plan. This saving might not be a lot by the end of 15 to 20 years but it will be sufficient for us to make a handsome kick start. Maybe we just need to top up a bit or maybe not.
Another question might arise when saving for our kids education. That is we do not know where they want to further their study ? How much they need ? What course they want to study and how long it takes to finish their study ?
So, the rule of thumb is, just put aside 5% of your monthly income for your kids education. At least we can ensure they have a good education. If by the end of the day, the amount not enough, we do not need to top up that much. If the money saved is more than enough, is still your money. Use it to enhance our retirement plan or continue to save for the benefit of our grandchildren.
Your children’s education lies in your hand. Talk to us now to find out what is the best possible ways of saving that suits your current financial planning.
Bye for now. Hope to talk to you soon.