Momma Tips: How to Financially Prepare for Your Child’s Education
My mom always tells me that education is the best gift she and my dad could give to me and my siblings. They worked hard to send us in the best schools and made sure that we will get the best and quality education. After all and based on my experience, where you graduated does matter. Now that I’m a mom, I hope to give the same to my girls.
Let’s face it. Education in the Philippines doesn’t come cheap. Tuition fee for preschool could go up to 100K and studying in the best universities in the country means spending at least P150,000 a year! That’s the tuition fee alone. Imagine how much it would cost 10 to 15 years after. That’s not all. You have to include daily allowance, gas money, books, school supplies, and other school-related expenses in the budget.
The key here is EARLY PREPARATION. Even if your child doesn’t start going to school until s/he is three or four years old, this doesn’t mean you won’t prepare. To ensure you meet your child’s education needs, here are some of the things you could do. 1. The power of estimate.
This is the first thing you need to do when preparing for your child’s education. If you’re not the future type of person, now is the perfect time to be one.
Estimating the costs of education gives you an idea as to how much you will spend. Aside from the tuition fee, add other school-related expenses in your computation. After getting the total, multiply it by three (or higher) since there are other factors to consider such as economy, inflation, and value of peso x years from now among others. Estimating will allow you to adjust your spending habits and evaluate how much you could set aside for your child’s education.
2. Start saving – now!
When do you think is the best time to start saving for your child’s education? There’s nothing wrong with giving your wallet a break and enjoy your hard-earned money after paying for the hospital bills. However, the best time to start saving is as soon as possible. This will give you a head start financially instead of saving a year before your child goes to school. At the same time, nothing beats preparing early.
Explore your options on how you could save and grow your money – which leads you to the next one.
3. One word: commit.
Sure, you started early in saving for your child’s education. The question is are you willing to commit to it?
Start with setting aside a portion of your income. It doesn’t have to be half or the entire amount since you need to pay for other household expenses and bills. Starting small and eventually increasing the amount could help you adjust in the process. Open a bank account dedicated for your child’s education and deposit a considerable amount every month. Make sure to stick to that commitment.
Think about this. If you are able to set aside P2,000.00 every month, then you will have P24,000 in one year. In five years, you already have P120,000.00, which is already a good amount when you enroll your child in school. What more if you are able to save or invest more than P2,000 monthly?
4. Go school hunting.
Aside from saving, one of the best ways to help you prepare for your child’s education is to go school hunting (Read about my tips on how to choose a preschool for your child). Remember Tip No. 1? Visiting schools and asking about tuition fees and other miscellaneous expenses could help you in the estimation process. At the same time, this allows you to check whether the school you are eyeing for your child gives what you paid for and is worth every centavo – facilities, manner of teaching, teachers, and the like. This also gives you an opportunity to explore payment options available.
5. Consider other methods in growing your money.
Putting up a savings account could help you prepare for your child’s education. However, you need something that allows you to grow your money more through legitimate means.
Getting an education plan is a good option, but with the controversies surrounding it, make sure to choose tried-and-tested insurance companies. Investing in the stock market could be a feasible option, but you also have to consider the volatility of the market. You could also look into time deposits, mutual funds, forex, or bonds, whichever works for you. Regardless of where you invest your money, make sure not to put all eggs in one basket and balance your portfolio. Make wise investments since the money is for your child’s education.
Education is an investment. With proper planning and ample preparation, you will be able to secure your child’s education and not worry about it later on in life.