Planning for the future costs of your child’s education is much easier said than done. For many parents, it’s difficult to plan so far ahead. Also costs escalate over the years, so how can you ensure that you are saving adequately for future high school and varsity costs? Here are 5 tips that can assist you if you’re in this predicament:
Invest in a unit trust
This investment is a useful and flexible option. Unit trusts allow you to make regular contributions whenever you have some cash to spare. This savings option is robust if you still have time to accumulate finances as you can increase, decrease, stop and re-start your investment without paying any penalty fees.
Deposit spare cash into your bond account
Paying a little extra into your bond account is a good way of saving, creating a nest egg that you could tap into to cover expenses such as your children’s tuition fees.
Invest in their academic or sport achievements
If your child excels at a particular subject or sporting activity, ensure that they get all the support they need to thrive. It could potentially save you anything from a portion to the full cost of their education through bursaries.
If your child is already in their senior phase or has matriculated, consider the following:
Take out a student loan
You may not have time to settle your mortgage or accumulate savings, but perhaps you will be able to act as surety for a student loan. This will cover a large portion of the fees, and will also ensure your child does not have to worry about finances while at school. Acquiring a loan can be difficult as lending regulations have become stricter in South Africa, therefore it is advisable to speak to your banker about the various options that’s available.
Apply for study finance
Many institutions and government bodies offer financial aid to students. The National Student Financial Aid Scheme of South Africa (NSFAS) is an example of such a body. Often, the aid is offered to students from disadvantaged backgrounds or those pursuing a specialised field of study such as medical research.
For more information on how to start saving today, contact Absa Savings and Investments on 0860 111 515 or go to www.absa.co.za