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When your children are first born, it’s easy to get caught up in the baby and toddler stages. It’s a time of firsts and everything is exciting and new. As time passes, they grow a little older and even start their first years of school, so it’s only natural you start to give thought to their future. As parents, you want to give them the best of the best and provide them with every opportunity possible, which includes access to a post-secondary education.
Of course, paying for college or university education is an entirely different topic and one that can cause quite a bit of stress and anxiety for parents. So, how can you start to create a nest egg that can be used for your children’s education? Here are some tips and ideas that may help you.
Get the Process Started for Them
For some parents, the idea of a nest egg for their child’s future seems a bit odd, but a nest egg simply means money that is being set aside for a specific purpose. When they are young, there’s no way they can do this on their own, so you are just helping to get them started. As they get older, they can start to help with the nest egg.
Investigate College and University Savings Plans
In the UK, there are college and university savings plans that allow you to invest lump sums or regular sums. These offer tax breaks on the pay-out and the growth of the fund. The earlier you can start this plan, the better, as it will have more time to grow.
Even if you can only afford to put a small amount away in those early years, it’s still better than nothing. Considering the average cost of university fees per year is now £9,250, the savings plan you start when they are just born will certainly help.
Consider Investing in the Stock Market
Maybe you are looking for ways that you can stretch your own money further and turn it into more money. If so, buying and selling stocks could be the answer. Of course, this isn’t something you want to take lightly; the stock market doesn’t offer guarantees and it can be volatile so you need to have some basic understanding of how things work.
CMC Markets offers an excellent platform for trading that makes it possible for newbies to understand the process, get involved in the stock market, and have a chance at realizing profits.
Encourage Your Child to Also Take Part
Once your child begins school, they are old enough to start learning about money and the value of it. Part of that lesson can be that they need to also start setting aside money towards their future. That could mean a portion of their weekly allowance, a portion of birthday and holiday money that is gifted to them, and when they start to work, a portion of their earnings.
Consider Your Home Equity and Retirement Savings
While this option isn’t quite as attractive, it is possible to tap into your home equity or retirement savings to help pay for school. This option should be the last choice though, as this money is meant for other things.
A Slow and Steady Process
For most parents, the idea of suddenly needing to come up with tuition money seems completely unrealistic and scary, which is why a college or university savings fund should be seen as a slow and steady process. This takes away much of the stress and makes paying for university so much easier.