Children’s Education funding

Written on the 14th of December 2009 by Continuum Financial Planners Pty Ltd

Overview

It is widely reported that the costs of raising children from birth until adulthood are very significant (by one recent survey, around $1,000,000 – 2009 value – from birth to age 25). By far the most important aspect of investing for the future of children is to save regularly and start early.

There are several different investment vehicles for savings and the preferred option, along with whose name the investment is in, will vary from family to family.

The range of options includes:

• Term deposits and hi-yield internet savings accounts
• Insurance bonds
• Scholarship funds
• Managed funds
• Self-funded annuity-style investment
• Direct shares
• Pay off your non-deductible debt (home mortgage)
• Pre-pay school fees
• Family trust

In determining which strategy is most suitable for your family situation, the advantages and disadvantages of each of these options need to be evaluated. Issues such as simplicity, tax effectiveness, liquidity, adequacy of outcome, title on demise, ability to continue contributing and cost, all need to be considered in this context – along with the available timeframe.

For many of our clients looking for a strategy in this regard, the secondary schooling costs are targeted. Depending on the number of children to be provided for – and their ages when the strategy is commenced – elements of each of the above strategies may be incorporated

Contact Us for an appointment with a Continuum adviser to get your strategy in this regard under way: the first meeting will be at our cost.