Research shows that education is one of the top priorities for South African parents. A recent study by Sanlam found that saving for education was one of the top four monthly expenditures among lower-income households, IOL reports.
Planning and saving ahead of time for school fees give can give you peace of mind, however it’s not always easy.
We chat to an expert on strategies parents can use to save up for fees.
Product Head, FNB Money Management Ester Ochse: shares some tips on how parents can save for school fees.
When it comes to saving, it is essential to plan and look at your budget. This will help you to analyse what you can cut out and where you can save money.
Ochse advises setting up a scheduled transfer into a savings account to use for stationery and uniforms for the upcoming year. Collecting reward points throughout the year can also be used for purchasing items such as uniforms, stationery, and any other items that you might need for the new school year.
He explains that this will help relieve the financial burden at the beginning of the new year when stresses are high and money is short.
“It is easier to come up with smaller amounts of money than one big lump sum,” he says.
While not everyone can pay all the school fees in advance for the year, if you can, this is a great way to save on school fees, as many schools give you a discount.
Choosing the correct savings account is also essential. When saving for school fees, you have to choose a short term savings account, which will allow you the flexibility to take out your money when it’s time to pay fees.
However, if your child is still in primary school, and you would like to save for high school or university, you might need a long term savings or investment plan. Once you’ve decided and you have your plan, chat to a financial advisor to help you look for the correct investment for your savings goal.