In the Philippines, education is valued as one of the most important legacies that parents can give to their children. Many believe that education opens opportunities to have a secure future. As Filipinos continuously face financial challenges, looming inflation, and other uncertainties caused by the pandemic, education remains a critical factor that must be prepared for to ensure a good future and a chance to be lifted out of financial difficulties.
The importance of preparing and securing a child’s education
“Education is our passport to the future, for tomorrow belongs to those who prepare for it today.” – Malcolm X
One of the most important things that can help secure your child’s future is education. It can help your child ease his/her way through the uncertainties brought by the changing world including inflation.
Inflation devalues the purchasing power of money. The essentials that you can still afford today may get too costly in the years to come. The quality of life that you aspire for your child may already come with an expensive price.
While the economic impact of inflation is concerning, you have the option to ensure that he/she will have the opportunities needed to secure the kind of life you have dreamt of for your child.
By investing in your child’s education, you are securing your child’s financial future, health, and quality of living.
Find out how much you need to set aside to afford your child's university education by using the Sun Life Education Budget calculator.
Short-term and long-term strategies to secure your child’s education
1. Keep your expenses in check
Be mindful of how you spend your money. Quality education in the Philippines comes with a price. On average, tuition fees in the Philippines increase by 10% yearly which is about twice the country's average inflation rate of 4% to 5%. You have to develop the habit of saving to have the fund you need for your child’s education.
2. Develop strategies
It isn’t easy to save, especially if you have a fixed source of income. However, there are strategies you can try that will help you allocate funds for your child’s education. One example of this is the 80-20 rule based on your take-home salary or the actual amount left after taxes and other deductions from your pay. In the 80-20 rule, 20% of your income is allotted to savings. The remaining 80% is then distributed, with 50% allocated to your needs, while the remaining 30% is for your wants.
3. Find a side hustle
Saving for your child’s education would be easier if you could have an added source of income. A side hustle will enable you to explore new opportunities, enjoy flexibility, and experience financial freedom. It will help you achieve your goals and provide the fund you need to save for your child’s education.
4. Do your research
Be aware of the financial planning options that can help secure your child’s future. Know the financial instruments that you can explore to know what will work for you and give you the most benefits.
1. Explore scholarship grants
Education in the Philippines may be expensive, but there are opportunities that can help lessen your financial worries. Scholarships are offered in many universities and may entitle one to huge discounts on tuition fees or full educational sponsorship. While many scholarship grants may be offered to top-performing students, some scholarships are based on a student’s qualifications. It's not too early to do your research now. This will help you and your child prepare for the goals you want to achieve and give you an overview of the processes you must comply with to qualify.
2. Open a business
One way to achieve financial freedom is to start your own business. It may bring challenges, but it will eventually help you gain financial benefits that you may not be able to achieve if you rely solely on employee wages or salary. Know the type of venture that suits you and determine its growth potential. With the right strategies, your business may become a financial asset that will grow your money as it also builds up its worth.
3. Invest in educational insurance plans
Investing in an educational plan now is one of the best investments you can make to future-proof your child’s education. Gain benefits for the long term, such as:
● Gain higher returns as compared to traditional savings accounts to keep up with inflation and tuition fee increases in the future.
● Provide for your family's needs even when you are no longer working due to age or disability.
● Fund your child’s dreams with an educational insurance plan that can empower and enable him to fulfill his/her goals in life.
Sun Dream Achiever is a life insurance and savings plan that can help you fund your child’s education and ensure your family's financial security at the same time. It offers increasing guaranteed cash benefits to ensure that your child has school funds no matter what happens.
SOURCES: adb.org cnbc.com Rappler.com Moneymax Lifestyle.Inquirer Bukas.ph
ALSO READ: What fathers can teach their kids about money
Although education gets expensive year after year and inflation remains a challenge, there are short and long-term strategies that you can employ.
Sun Life as a Partner for Life can also be your partner when it comes to securing the future of your child/ren. Check out these life insurance plans and see what’s fit for his/her education needs.