Actually, there are so many ways to get around the fund of children's education, especially for parent who have more than one child with variety level of education.
Here, Agustina Fitria Aryani, Financial Planner Head from OneShildt Financial Planning give you tips and advices about how to plan the fund of your children's education in the future.
For parents, children's education is high priority. However, if parents have two children or more with the level of age adjacent and still require the long level of education, then the fund of education need to be prepared very well. This is a part of financial planning that parents should be able to do.
Parents are need to discuss and agreed to determine the direction of children's education, for example about school type such as formal school or homeschooling, the type of curriculum, the country or private, until the domestic or abroad.
After research the few schools in accordance with the direction of the education, then the next parents need to adjust with the ability to pay it fund.
If parent choose the formal school, then there is the main component of Education Fund such as money building, monthly/quarter/semester fees, including extracurricular and learning outside of school, and the annual money including activities, re-registration, books, and uniform.
For example, the current age of children is 8 years (class 2 Elementary school), 6 years (kindergarten bed), and 3 years (playgroups). Parents need to make planning education fund to the University level. It mean, there is a need for daily, monthly, and annual fund that should be prepared for 3 children at once. Then parents should be good at manage it so as not to burden of family's cash flows.
In the management of family's cash flow, it suggested that spending for living cost maximum up to 60 percent, for investment 30 percent, and entertainment 10 percent. Living cost consists of the installment debt, insurance, household, transportation, spending for children, and social.
Spending for investment consist of fund for the preparation of retirement, educational/self-development for parents include "training", seminars, and buy the books, and investment to prepare money for children's education.
While the amount of spending for entertainment is 10 percent, it is intended for fun as one of the ways of keeping the life balance, for example for the holidays, hobbies, and others.
What if the fund of children's education cause the family's living cost spend more than 60 percent of income? There are several alternative can be done.
Need cost reduction of life less priority, for example, the installment debt consumptive, insurance premiums improper target, choose the monthly shopping with low prices, and get used to eat at home.
The next suggestions is to select one kinds extracurricular/non-academic course that really in accordance with the children's talent and interest and familiarize children bring the provision of healthy food from home to suffice the needs during the school and on the way.
The last alternative is parents need to improve their talent, skills, and competence thus can be used to provide additional income then can suffice the living cost, including the children's education funds.
Reduce the debt to fund of education, because basically debt for education fund is included in the consumptive debt because of its not add assets.
Better if parents spend children's education well in accordance with the ability than add finance charges of family with debt.