Like most parents we agonise over the cost of providing the education needs of our children in the future – when our financial circumstances may be somewhat different from what they are today. The costs of raising children escalates as the years pass (until finally they become net cash flow positive).

 

Background

 
All parents strive to provide the best future they can for their children. Many seek to provide education through private schooling; others prefer to provide a broader education through life experiences including travel. In either event – and anywhere in between these ‘extremes’ – there is a significant cost factor going to arise when the child attains secondary school age.

These costs can arise amongst other ‘unknowns’ including financial upheaval, career interruption, home relocation/ upsizing, and naturally increasing expenses as the family grows. How can we help?
 

 

Strategy

 
If parents make investments into an agribusiness project that will provide an income stream at the relevant time, they will be making a small sacrifice now (while income and expenses are at a known level) and establishing a significant income stream for the future.

Given that this investment will effectively be at a cost slightly more than the tax they would pay on the similar amount, they could take the investment over a term of borrowing through a facility established by the manager. The only security for this loan would be the agribusiness investment asset – and any interest paid on the loan will be tax deductible.
 

 

Solution

For each child that is being provided for, an assessment is made of the amount that will be required to meet the future cost. Based on the calculators we have available, we can determine the appropriate level of agribusiness investment required – and the number in the series of investments that would best meet the needs.
 

 

Result

• Surplus cash flow from available years has been set aside 
• An income stream has been generated
• Tax savings (and potential increase in government benefits) have been received