Tips For Building Child’s Overseas Education Corpus
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A college degree is costly, and you cannot hide from the fact. At the same time, the corporate world has become very competitive, and to excel, your child needs to stand out. The best you can do for him is to create a corpus for her higher education. Below are some benefits of higher education:
a) The first and apparent reason is the salary gap between those who have a post-graduation degree and those who don't.
b) In the coming years, there will be an increase in demand for jobs that require specialization. Higher education will give that to your child.
c) The future will not be just about a degree in science or arts. It will also be about strong proficiencies in writing and communication. Higher education works significantly on the all-around development of your child.
How To Build a Corpus for Your Child’s Education in Overseas?
It is clear your child's overseas education corpus will not come overnight. You have to start planning for it now. Below are some tips that will help you create your child's overseas education corpus:
1. Select Your Investment Options
Depending on your investment horizon (when you will need the funds for education), you can select your investment options. If you have sufficient time to create the corpus, you can go with equity investment, and as your near the goal, you can move your investment to other safer classes.
Another option is to choose a plan that lets you invest in different financial instruments depending on your goals and investment horizon. At the start of the investment, you can keep your investment in equity funds and later move to safer debt funds. Another aspect you need to take care of while planning for your child's future is to prepare for the worst-case scenario, your early death.
2. Start Early
Many parents wait for the right time to invest in their child's education corpus. The right time may never come, and hence the best strategy would be to start early, start now. Starting early investment ensures your investment grows over time and matches your child's growth.
You may be delaying investment for a child's future now because, at present, you can invest only a small amount. Even small regular investments can create a corpus for your child if you have time in hand. You must start early with whatever amount you can and increase your investment towards your child's overseas education corpus as your salary/savings increase.
3. Automate Investment
You cannot create the required corpus for your child if you have not planned it well. To create a corpus, you need to automate your investment. You cannot invest for your child's future with lump sum investment as and when you have money. As part of your planning, you need to decide how much you need to invest per month/year and automate the process.
4. Ensure Passive Risk Management
It is hard to keep an eye on long-term investment. As mentioned above, you need to automate your investment. Similarly, you need to ensure risk management is automated.
5. Revisit The Plan Progress Every Few Years
When you invest with a long investment horizon, you must regularly track your investment. When we talk of creating a corpus, you have a certain number in your mind. You also know the amount you can invest yearly. To reach the corpus amount with your investment, you will need your investment to grow at a certain percent.
Conclusion
The upbringing of children demands a lot of planning for their bright future, starting from school education to higher education. To safeguard your child's future, you need to have the foresight for long-term planning.
