When you invest in the acquirement of knowledge, you will receive the best returns for your money. Needless to say, parents in Singapore and other countries want to provide the best for their children. That is why it is never too early to save for your child’s education. Beginning a savings plan as soon as he or she is born can assist you in paying for your child’s future tertiary education.
Why You Need to Establish a Plan Now
It is important to make savings a priority as the goals your child sets may not be able to be met, educationally, in Singapore. If he or she wishes to continue their education overseas, then you will have to be prepared financially. Without proper financial planning, that future sum may be too hefty to meet.
Whilst future educational expenses may be high, establishing a savings plan may be the best gift you can give your children. After all, inflation does not even make allowances for education. Based on an inflationary rate of just over 1.5% yearly, it is not unreasonable to assume that your child’s educational costs will be substantially elevated by the time they enter university.
Inflation Never Takes a Holiday
Everything is put into perspective when you consider past hikes in tuition fees in Singapore. For instance, parents who look for child education plans in Singapore want to make sure their savings initiatives can meet increased future expenses. During 2015, for example, tuition fees in Singapore rose by as much as 8% in order to match rising costs. In addition, small increases in courses weighed heavily on people who did not plan and save ahead of time.
Whilst the aforementioned percentage may seem staggering, it still is the price that is paid for education in Singapore. If you have more than one child, you definitely need to establish education savings plans. In its most basic form, a savings plan for education is underwritten by an insurance company. A lump sum is then received upon maturity of the plan.
Working with a Financial Professional
Although this type of plan can be regarded as a savings initiative, it also permits insurers to see when a saved amount needs to mature and be used. By employing a fixed window, savings plan professionals can determine how much a child will need for his or her education and outline a portfolio.
Your premium rate for a savings plan is contingent on when you enrol. If you sign up early, you can reduce the amounts paid in premiums. Whilst a public university Singapore will allow parents to fund their child’s educational needs through the use of their CFP, you do not have this option if your child wants to study overseas.
Savings Plan Highlights
Regardless of what happens, you still need to make sure you have an education savings plan in place. Plan highlights include a cash benefit before the date of maturity and optional insurance riders. Savings are also formatted in 5, 10, or 15-year windows – all of which enables you to save at a comfortable pace.
Carefully consider your choices and be prepared. Start planning when your child is an infant to ensure his or her personal and financial security in life