You sit on a bench with your lover, and you discuss about an imaginary, happy and peaceful future together. Marriage comes next, and what's after that? You get to raise your kids. However, do you have what it takes to become responsible parents, especially in preparing for your child's educational needs?
Financial matters is just one, yet a very large thing to worry about in starting a family. Aside from the home expenses, what will eat up the majority of a family's budget is, or most of the times, are the educational expenses of the children. Can you cut the budget for their education? Do you have enough money to send them to school until they graduate? If you answered “no” to these questions, then you might as well follow these three ways on how you can save just right (or maybe, even more than) what is required to secure your child's educational career.
First: Secure your job.
Before being able to manage your expenses, of course you have to search for a stable job that can help you generate enough income. With this, you can ensure that you can provide not only for your family's house expenses but also for the educational expenses of your children, too. If you think you are not generating the appropriate amount of money for your family, then consider searching for other jobs that can help you acquire the right income. However, remember not to resign if you are not yet secured with the work you are prospecting to enter. Also, if you can still manage to do so, find a sideline that won't require too much physical work from you. If you can cook, can you sell some of your food to your workmates? If you can write, can you spend an hour running a blog? If you can't, then be prepared to do some extra by working fast and efficient on your job, and ask your boss if there's something else you can do. Who knows, promotion might come knocking on your door in a few days' time.
Second: Learn how to segregate.
Proper money management can get you far, especially if you know how to set your financial priorities. Segregate your salary to your living expenses, which includes electricity, water, food, school, and the like. You might also want to allot a portion for your leisurely activities, but do not forget to reserve a portion of your money for emergency funds. Always make sure to cut off around 5-10% for your emergency funds, so as to make sure that when there comes a time when you will have to use that money, you will have just enough. Ideally, emergency funds should last for not less than 6 months. With the remaining 90-95%, you can use it for your living expenses. You might as well try to cut off 10% for your children's educational needs, as early as after your marriage. This might seem off to you, but it's better to prepare as early as possible. Educational expenses, after all, mostly increase every school year, whether we like it or not. At least, when it comes the time the money is very much needed, you will have enough to pay. Also, make sure that leisure funds are at the bottom of the list.
Third: Engage in investment planning.
Segregation or allocation of expenses is a must, or else your salary might go haywire and pop like a bubble in thin air. Surely, we don't like that happening, right? Especially if you have children to send to school. That is why, you can also try investment planning, wherein a professional financial planner can help you in managing your money. As what I have mentioned at #2, you should allocate 10% of your income for the future educational needs of your children. This 10% should be invested properly so that growth funds will overtake the rising cost of education. In addition, you can also try joining pooled funds or mutual funds. Mutual funds can be a good instrument in investing, since it is mostly available for ordinary citizens. With as low as 5000 pesos, you can already join other investors. With the help of a reliable and a professional fund manager, the invested money will be engaged with money generating assets like bonds, stocks, or both. The upside here is that even if you invested a big money or not, you earn the same profit percentage as of the group.
This is perfect for people who still have to learn more about the stock market, or even for those ordinary parents who want to give their money a boost. With educational expenses continually rising, you can make sure that your money is also growing parallel to it. Securing money for your children's educational needs is a must. In addition, if you have saved too much, it is still an upside because you can use this money for other expenses, too. You may also want to use the excess to other needs, such as retirement funding.