5 Easy Steps For Financial Planning EducationEducation is the best gift that can be given to children by parents. It is also a matter of concern for parents to fund their child’s education. With proper planning, one can be free of such worries. Here are 5 easy steps for a better financial planning education: 1. Estimating education costs: Parents must make an honest attempt to estimate the cost that will incur on their child’s education. Tuitions fee will figure first in this list. One must try to anticipate the rise in fees for next several years till child passes out of the school. Books and supplies also forms major part of education expenses. This should include various other expenses like photocopying etc. Personal expenses such as clothing and recreation too should be accounted for. Another commonly forgotten expenditure is transportation cost. 2. Identifying available resources: One must explore all the possibilities from where funds can be arranged for child’s education. Now a day, a lot of financial aids are available right from the beginning. The amount of aid which one can expect depends to a great extent on the size of the school's endowment, how much the school really wants to recruit the child, and how the school allots its scholarships. It is always advisable to make a short list of schools and see what the various schools on the list can offer. Also, many civic and religious groups provide scholarships. To avail such facilities, individual community can be contacted. 3. Education funding process: Parents must try to optimize while funding for education. For example, some school allows fee payment in installments. Such facilities must be used.4. Saving money: It is always better to start saving money for child’s education as early as possible. There are tax-favored choices that encourages people to make saving for education. Some of them are Coverdell Education Savings Account, Custodial Account (UGMA/UTMA) and 529 Plans to name a few. One must find the plan most suited to him as it varies from individual to individual. 5. Developing an investment strategy: It is always advisable to develop an investment strategy which will cater to financial planning education. Saving money alone will not help much in long run. The money must grow to factor out inflation. There are so many options available to invest money and get handsome returns. One must meet his financial consultant and take his advice in this regard. |