If you think education is expensive, try ignorance.
Here in the Philippines, parents really value their children’s education. Don’t you agree?
Sadly, most of them were not able to plan for the educational expenses, especially for college/university.
As a financial planner, I help parents plan for their kids’ education starting from the farthest (and most expensive) goal which is college.
If you’re reading this and you plan to send your child to any of the top colleges & universities and you don’t have a plan in place yet, don’t worry because I’m here to help you.
Let’s start with a Reality Check. Here are the Top 10 Most Expensive Colleges and Universities in the Philippines (Source: AbsCbn News)
5 – De La Salle – College of Saint Benilde (at least PhP180,000 per year)
4 – Center for International Education (at least PhP180,000 per year)
3 – De La Salle University (at least PhP196,000 per year)
2 – University of Asia and the Pacific (at least PhP225,000 per year)
1 – Enderun Colleges (at least PhP250,000 per year)
Your children’s college education can easily cost around PhP1 Million considering other school fees, allowances, and learning materials!
Don’t forget about inflation
Simply multiplying the tuition fees by the number of years in college does not give you your goal for your child’s college education fund.
We have to factor in the inflation rate of education, which is at a nationwide average of around 6% – 8%
For example, if you will start planning for your newly born child’s college education fund for Enderun Colleges, he or she will start college at around 19 years of age.
For a 250,000/year course, 19 years from now, factoring in an inflation of 7%:
1st year college tuition will cost: PhP904,000
2nd year: PhP 967,000
3rd year: PhP 1,035,000
4th year: PhP 1,108,000
Total college fund goal: PhP 4,014,000
Now ask yourself if you are really preparing for your child’s education fund.
I can help you plan for it, contact me now.
Time is of the essence
In investing for your child’s college education fund, you want to start as early as possible so that you can take advantage of the power of compounding.
For our example case, assuming we invest your savings (not in the bank!!!) in an instrument that will give 8% return annually here’s the difference between starting now versus delaying:
Start the moment your child is born: Save and invest PhP8,084/month for 19 years
Wait until your child is 5 years old: Save and invest PhP13,833/month for 14 years
Delay until your child is 15 years old: Save and invest PhP74,200/month for 4 years
Mind-blowing difference, right?
So, would you rather start now or start later? I’ll help you, let’s talk.
Please share this with your friends to show them that you care for them and their child’s future.
Featured image source: blog.unbound.org