Education fees and planning for the future

Education fees and planning for the future

The new arrival of a grandchild brings joy to the heart of a grandparent. Instinctively grandparents want to look out for their newest family members, hoping to help them grow up happy and healthy. Many grandparents also hope to assist their grandchildren by making financial investment on their behalf, but sometimes are unsure as to the best ways to go about providing this investment.

Perhaps one of the most valuable investments into a child's future is a university education. Statistically, well educated people increase their earnings potential dramatically and over the course of their working life an educated employee can expect to earn considerably more than their less educated peers. While the cost of going to university seems to be increasing at an alarming rate, most parents and grandparents still rate the importance of helping children to secure a sound education as one of their top priorities.

The cost of private education in the UK, for example, is costing anywhere from 10,000 - 25,000 per year. Visiting a prospective school should be a joyful event for all parents/grandparents, however far too often it will depend on financial status, as this will ultimately dictate what schools are chosen by parents. In the UK, research suggests students owe an average of 23,500 upon university graduation. It is feared that any rise in fees or loan rates would dramatically escalate debt levels.

If you have dreams of sending your children/grandchildren abroad for a top university education you can expect to pay considerably more. At present you will need to pay about $200,000 for a four year course at one of the leading universities in the US. This is in todays money value of course, for a child that still has over 10 years before embarking on a university degree these figures will rocket alarmingly, thanks to compound inflation and the fact that education fees are growing in excess of inflation in most countries. It means that as well as student loans there are also parent loans - with huge sums of money being borrowed by people who might have been planning for their retirement.

There is also a new challenge on the horizon; helping children or grandchildren purchase their first home, by building up a deposit or perhaps contributions to something smaller like their first car. Not to mention the cost of a wedding! The average cost of a Wedding in the UK today is typically between 11,000 - 23,000.

There are steps you can take now to put plans in place to help save for these inevitable events. For example, you may want to consider taking out a savings plan either with an initial lump sum contribution and/or by saving regularly each month over a period of five to ten years plus . Many savings plans can be set up either with a lump sum of around 10,000 or 150 per month if preferring to save on a regular basis. They will also provide you with access to the top performing funds managed by the most highly rated fund managers to ensure the money has every chance to grow to a sizeable amount, rather than devaluing' on cash deposits in the current low interest rate environment. An Independent Financial Adviser will be able to help you calculate how much you would need to save to reach your goals or help you to base your contributions on what is affordable to you at this time.

Starting to save early in a child's life allows time for your investments to grow and mature, which can add up to a considerable sum by the time that child reaches 18. Even family members saving for older children can be assured that by making careful selections with their investment, the child will still benefit. With the ever increasing cost facing children of today, every bit of financial assistance means a lot to their future.

As an Independent Financial Adviser, can help assist you with all aspects of your financial planning. There are a range of solutions for those wanting to save for their children/grandchildrens future that will suit a wide variety of budgets.

Expat Wealth Builder provide tailor made solutions for all your financial planning needs.

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