In today's advanced era, education is the number one thing that must be prioritized. Even though it does not guarantee success, education is an important provision in supporting your child's dreams.
That is why education funds must be prepared from now on so that children can receive the highest possible education. By investing in Fixed Income Mutual Funds, education funds can be prepared easily and safely.
Easy Tips for Preparing Children's Education Funds
What is education fund? Namely all expenses in the form of funds or goods used to support the child's learning process. You can prepare it from now on by doing the following tips:
- Determine the Intended Educational Institution
The first thing that needs to be done before preparing education funds is to determine the educational institution. Before making a decision, you must do a survey first to see what school or university is suitable for your child.
In this way, parents can get an idea of the situation and quality of the educational institution. Apart from that, you can also estimate the range of costs required. It's best not to do a survey in just one place but to do it in several places to find comparisons.
- Make an Education Budget Plan
After knowing which educational institution you aim for, you can then plan your education funds. The calculation method starts from building fees and registration fees, monthly education fees, and the child's daily needs.
It should be noted that payment procedures at each level of education are different. For example, school fees at Kindergarten to Senior High School levels are paid every month.
However, higher education costs must be paid per semester (once every 6 months) but some are paid once a year. Every educational institution generally provides complete tuition fee information.
Fees include registration fees, annual activity fees, and monthly tuition fees. So you can use this information as a reference for preparing your child's education funds in the future.
- Calculating Inflation
Inflation not only impacts the economic sector but also the costs of children's education. That's why, before calculating it you have to include inflation into the calculation. Let's just say that inflation currently reaches 4 – 5 percent.
It is possible that education fund inflation will be higher than this figure. From the example above, you can enter a figure of 6 – 11 percent for the estimated increase in education costs. To better understand, see the following calculation example:
Example:
Now your child is 2 years old and in 4 years he will enter an international elementary school. Let's just say that the average international primary school tuition fee is currently IDR 20 million and inflation is currently 4 - 5 percent (potential increase of 6 - 11 percent).
Quoting from parenting.co.id, the following is the correct way to calculate education funds:
Current School Fee + (Deadline x Annual Inflation Value)
Calculation:
IDR 20 million + [4 years x (11% x IDR 20 million)]
= IDR 20 million + (4 years x IDR 2.2 million)
= IDR 20 million + IDR 8.8 million = 28.8 million
- Prepare Education Fund with Investment
Why should you prepare it with investment? So that children's education funds can be prepared faster. By investing, you will gain potential profits that can increase the value of the money.
By increasing this value, the funds saved can reach the desired target faster. Fixed Income Mutual Funds are one of the right investments to prepare children's education funds.
Apart from being safe and low risk, this investment is also stable when compared to other Mutual Funds. The profit value offered is also relatively higher than Fixed Deposit interest.
- Focus on Goals and Do Evaluations
When you have invested funds for your child's education, you must consistently maintain them. Don't withdraw these funds for other consumptive needs. For urgent needs, use emergency funds rather than education funds.
If you want to prepare funds for education up to university level, you should invest your funds regularly. So that the target education funds can be prepared on time.
Benefits of Preparing Children's Education Funds from Early On
There are still some people who think that preparing funds for their children's education is not that important. People who think like this are usually indifferent to their financial condition because they feel they will always have enough. However, no one can predict what their financial condition will be like in the future.
Actually there's no harm in preparing education funds, especially if you do it from early on. Because there are many benefits to be gained, here are some of them.
- Guarantee Children's Education
Every parent definitely wants to see their children succeed by becoming great people. To achieve all this, they need good educational provisions, both formal and non-formal education.
By preparing education funds, your children's chances of success will be higher because their education funds are guaranteed.
- Free from Expensive Costs
The high cost of education from year to year makes some parents feel burdened. It is not uncommon for them to have difficulty providing the best education for their children.
But this won't happen if you prepare from now on. By preparing education funds, parents do not need to feel burdened by expensive school fees.
- Avoid Debt
Many parents are willing to use borrowed money to pay for their children's education costs. This is certainly not good for your financial condition if you do it continuously. There are even those who are willing to sell their valuable assets just to send their children to school.
If you prepare education funds from the start, this doesn't need to happen. You will avoid accumulating debts and installments, so your financial condition will be much healthier. Not only that, valuable assets will also remain safe without having to think about children's increasingly expensive school fees.
Preparing Education Funds Through Mutual Fund Investments
You can start preparing funds for your child's education through investment with DBS Treasures priority banking. There are many benefits provided, one of which is ease of investment. Because all transactions can be done in a single digibank by DBS Application.
Starting from registering for Single Investor Identification (SID), buying and selling Mutual Funds, to switching investments can be done on the digibank by DBS Application. There are many Fixed Income Mutual Funds benefits that you can get.
Through DBS Treasures you can also diversify to reduce investment risk. Because there are a variety of products available that you can choose according to your preferences.
Gain the support of curated market analysis from a team of financial experts who will communicate it. Seize the latest opportunities that have been tailored to your risk profile and portfolio needs, driven by Artificial Intelligence/Machine Learning (AI-ML). This insight is equipped with curated solutions related to investment (Grow) and insurance (Protect), so you can quickly and confidently invest through your preferred media.
Register yourself now and start investing funds in Fixed Income Mutual Funds through DBS Treasures. Click here to see detailed benefits and advantages.
