A guide to planning your child’s education: From costs, goals to investments

Ask any parent to list their key commitments in life and child education will likely find a top place in the list. Regardless of their own educational background, parents desire quality education for their children, making it one of the most significant expenses in life, alongside healthcare.

As John Dewey, an American philosopher and psychologist said, “Education is not preparation for life, education is life itself.”

How much will it cost you and how much is enough?

Planning your child’s education is a strategic journey towards their future success. Investing with a goal brings discipline, balancing present desires with future needs. And through disciplined investment, one can build a substantial corpus over time.

Here are some important steps in planning your child's education:

• Define Your Goals – Thorough thinking and understanding of the educational goals
• Assess your finances with a Financial Advisor
• Understanding Education Cost
• Creating a Personalised Plan and Exploring Investment Options
• Implementation, Regular Monitoring and Review
• Continuous Communication

Now that you have got a basic idea of what is involved in planning for your child’s education, let us take a closer look at the points mentioned above.

• Thorough thinking and understanding of the educational goals
  

Start planning for your child’s education early by observing their interests in their formative years. Ofcourse, the plan will be tentative as it can change later based on their growing interests. But early planning is crucial. Consult an experienced Financial Planner to guide you.

• Assess your finances with a Financial Advisor
  

A financial planner will conduct a thorough analysis of your current financial status, taking into account your income, expenses, debts, and assets. This analysis will help to determine how much you can allocate towards your child's education.

• Understanding Education Cost
  

Find out the current and projected costs of education, including tuition fees, accommodation, and other related expenses. Understanding these costs will help in setting realistic savings goals. Your financial planner will be able to make a personalised plan with this information. This knowledge not only helps set realistic financial goals but also ensures that your child's education fund accounts for all potential expenses, providing a solid foundation for a successful educational journey.

• Personalised Plan and Exploring Investment Options
  

Based on your financial situation and education goals, your financial planner will develop a personalised education savings plan. This plan will then determine how much you need to save regularly, where to invest your savings, and how to adjust the plan over time. Your financial planner will guide you through the various investment options available tailored to your risk tolerance and time horizon. Investing in Mutual Funds is a great way to tackle rising education costs.

• Implementation, Regular Monitoring and Review
  

Once your education investment plan is in place, your financial planner will help you implement it by setting up the necessary accounts, initiating regular contributions, and monitoring the performance of your investments. Like any financial goal planning, education planning is also a dynamic process. Regularly review the progress of your education savings and investment plan with your financial planner. Adjustments may be necessary based on changes in your financial situation, market conditions, or educational goals.

• Continuous Communication
  

Maintain open and regular communication with your financial planner, keeping them informed of any changes in your family's circumstances or educational goals. This ongoing dialogue ensures that your plan remains aligned with your evolving financial needs.

By following these steps in collaboration with a financial planner, you can effectively plan and prepare for your child's education, ensuring they have access to the opportunities which they need to succeed academically and professionally.

To conclude, under expert guidance of a financial planner, invest strategically inmutual funds as it is the optimal instrument both from an investment and inflation perspective. Regularly revisit and adapt the plan, with the ultimate aim of securing a solid financial plan for your child’s education.

Disclaimer: The article is authored by Shekhar,Director,Wealth Direct Mutual Fund Distributor Pvt. Ltd. The opinions expressed are those of the author and do not necessarily reflect the views of Business Insider India. Do your own research (DYOR) before deciding to invest in any financial asset class.

This article is published by the Insider Studios team. You can get in touch with them on insiderstudios@businessinsider.in.