Education is the key to success in any field for anyone. Many parents finance their children’s education by paying for their children’s schooling. Other parents choose to fund their children’s education through a combination of work, grants, and loans. Parents can decide how they want to fund their children’s education, depending on their financial situation and the level of involvement they want with their children’s school.
Most parents pay for their children’s education by paying monthly tuition fees or buying textbooks and other school supplies. Some parents may pay a lump sum at the start of the academic year to have their child publish the entire course in one sitting. Parents usually pay for their children’s education because they want them to succeed in life and get them the ideal job if they receive a good education. Many employers also require a degree before hiring someone new or promoting someone within the company’s ranks. Therefore, it is important for parents to have a strong reason to fund their children’s education as this can affect the child and family
Children’s education is one of the important needs that requires large costs. The cost of education even increases every year because it is influenced by inflation. This makes you have to be more prepared to pay for your child’s education from a long time ago.
There are several saving strategies that you can do to prepare for your child’s education costs. These strategies include:
People with conventional lifestyles usually choose conventional savings to prepare for their children’s education costs. Conventional savings are superior because they can be used anytime for urgent needs. Unfortunately, conventional savings interest rates are very small and cannot keep pace with the inflation rate.
Almost all banks provide educational savings products that are guaranteed by the Deposit Insurance Corporation (LPS). If the bank in question goes bankrupt, the education savings are safe and can be withdrawn by the customer. Basically, education savings are term savings that require you to make regular monthly deposits for a minimum of two years.
Education insurance product is a combination of education savings and term life insurance. The insurance company will pay for education when the child will take a certain level of education (elementary, junior high, high school, college). If a parent dies, the insurance company will cover the cost of the child’s education in accordance with the agreement on the insurance policy.
In contrast to conventional savings, deposit interest is usually higher, it can even reach 6% per year. However, there is a certain period of time that makes deposits cannot be withdrawn arbitrarily. You must estimate the time period of the deposit carefully so as not to incur a penalty fee during the disbursement.
Mutual Fund Investment
If you choose to invest in mutual funds, the money you deposit will be managed by an investment manager in the capital market. Although the profits are smaller than stocks, mutual fund investments are still relatively low risk. The benefits of this type of investment can offset the rate of inflation so that the cost of children’s education can increase over time.
If you don’t want to invest in a complicated system, you can try investing in gold. The price of gold tends to rise every year so it remains a favorite of most people. You are free to choose gold investment in the form of jewelry or precious metals according to your financial condition and needs.
So, which type of investment best suits your financial condition?
Let’s take advantage of the right investment instrument to secure your child’s education costs.
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