You would agree, if it is said that education and the future of children is a very important thing for any parent. In fact, it is becoming one of the most important among others. That’s why every parent, always want to make sure the education of their children can run well and be a provision for the child’s future will be.
You and your partner will try to prepare everything from scratch, including the children’s education fund in the future. You must consider and calculate all costs very mature, and then try to start to prepare since they were little, right?
There is always a possibility your failures, including in regulating children’s education fund. This will largely depend on how well you apply the method in the preparation. But in fact, the error in this case could be a very fatal, where you will have difficulty fulfilling children’s education in the future, or even it could have made a stuttering child in his education.
As a parent, you certainly do not expect any disruption in your child’s education, therefore avoiding the failure in managing their education and set aside. Preparation and also the selection of appropriate investment, can make you successful in planning for children’s education fund. Do not let you have any errors in this case, look at some common mistakes parents do when their educational plan below:
1. Do Not Have Proper Planning
Preparation education fund child will involve a very large sum of money, and it should be planned very mature in your finances. That is, you have to arrange and rearrange existing financial budget from the beginning, and then put the education fund post in it.
There are many people who make a fatal mistake in this case, where they do not perform realignment budgets and customize a variety of posts therein. Related to the amount and also other policies, if it turns out you do not have expertise in this regard, it would be very appropriate if you call and ask for help on a financial consultant skilled in the art.
2. Delaying Up Late
Other errors are often made by the parents are delaying the provision of children’s education fund, this even happened despite many they already have a plan for it. A plan not being implemented, surely there will never be useful, is not it?
Educational plan is not an easy thing you can do in a few months, especially if you only have a standard income that is not big enough. That is, you will need a rather long time to meet the educational fund, because if the amount is imposed on your finances, then the other expenditure items could be disrupted.
3. Taking Into Account Inflation
Education fund is a fund that will be used in the future, that is not now. Then the value of the growth of inflation becomes mandatory for you can count on it. Every year the cost of education will increase, so it is important to prepare for it since the beginning.
Some parents make the mistake of ignoring it, and you can imagine the consequences for a child’s education. When in time the funds are used, then surely the numbers will be very far from enough, because over the years the inflation has eroded the value of the education fund. Then, what would you do if something like this happen?
4. Choose Time Not Right
Education funds will be required gradually, so you must be wise to put them together in the right investments. Be careful not to choose the time of investment that does not correspond to the period of the child into the level of education.
For example, if you want an investment to fund the education of children entering kindergarten, it is very appropriate if you choose a medium-term investment where the investment period can be adjusted to the age of children entering kindergarten about 3-4 years. However, if you intend to invest as a fund children’s education when college later (18 years), then the long-term investment is the right choice for you.
Errors in choosing the time and the appropriate type of investment, is often the reason why you fail in setting up education funds. Do not choose the time and type of investment without a proper calculation, this will make the benefits are maximized.
5. Prepare Funds Too Little
Education fund that you set up may not be appropriate and not enough, which is why it is important to calculate it from the beginning. Shortage of funds is not an easy thing for you to overcome in the future, especially if it turns out your income will be in the amount of mediocre only. That is, you do not have a reserve fund that can be allocated to fund children’s education.
6. Investment Unjustified
Various investment instruments you can make a choice as an alternative to fund children’s education in the future. But how you know and understand about the investments?
Do not invest in fields that do not master it, especially the risk is quite high. Dividing investment in some products is the right choice, that means you also share the risk on the investment you make. Investments not right, it could make a number of these funds disappeared.
Plan and Immediate Perform
Although you are still a small child or even unborn, set up education funds are things you should do immediately. Have a good plan for this, including to finance overall. Select the type of investments the most appropriate and beneficial for your child’s education fund, but that of course you know and understand well the risks and benefits.