It is very important to save money for your child’s education. Every child has dreams of going to college, but saving money for your child’s education is one of the biggest goals that parents can accomplish. You must make sure that your child goes to school and gets a good education. This way, he or she will be prepared for college and have the ability to achieve his or her goals later in life.
Saving money for college education is extremely important because you will need to pay a lot of money when your child enrolls in school. When your child starts school, he or she may only be in elementary school. There are many expenses that are needed to start school. These expenses include tuition and room and board.
Your Checklist of Things to Do If Your Planning Is Off Track
To achieve your goals, you have to be able to accept your failures. There will be many times when you are not on track with your goals. This doesn’t mean that you are giving up or that you are not doing anything. It means that you are still working towards your goals. You should stay motivated and focused on your goals.
We have learned that one of the biggest reasons why most people fail is because they are not willing to make adjustments. The following are some ways to help you avoid being off track. First, make sure that you have the right goals. You will not succeed if you are not clear on what you want to achieve. Setting realistic objectives is crucial.
You can use the following list of steps to help you clarify what you want to do:
Verify whether you have time on your side.
You should know what you need to do to reach your goals. You might have to make changes to your habits or routines in order to succeed. Try to look at each goal you wish to achieve in life with a sense of urgency. The time is ticking. If you wait until the last minute, you will lose out on valuable opportunities to take advantage of.
Consider all the tasks you have to complete. Find out what you have to do in order to reach your goals. In doing this, you will save yourself a lot of headaches. Also, try to figure out whether you have the time or not. You should know if you have time available before you decide to do something.
Analyze if you can downsize your goal
When you prioritise your affordability over your aspirations, this works wonders. For example, if you had always wanted to provide your child with the highest education but lack the funds, you may decide to adjust your child’s college selection to one that matches your budget or current goal and to guarantee they still receive a decent education. If the college your child wants to attend costs INR 40 lakh but you can only save INR 25 lakh, you could think about switching colleges if you can afford it.
Review if you can increase your investments
As an investor, you always want your portfolio to be in line with your risk tolerance and offer you sufficient returns to meet your objectives. However, the situation is not as lovely as we may believe. If you notice that you are losing ground, consider whether there is a chance to top off your portfolio.
In a volatile market, a lump sum top-up can frequently help you get back on track. Only if you have time on your side is this applicable. If you are saving for your child’s education and the market volatility has reduced the value of your portfolio in 2021 and 2022, take this into consideration. If you have more than five years until the deadline, you can top out your portfolio with a lump payment to get back on track.
Find alternate solutions to fund your goal
This is more relevant to inescapable objectives that will materialise at a particular point in your lifetime. such as the education of your child. Consider that your expected SIP was INR 10,000 but that you could only contribute INR 7,500 because you began making plans for your child’s higher education early.
The INR 2,500 difference each month will cause a sizable difference between where you ought to be and where you are in the target. Assuming you need to pay for your child’s college over a ten-year period, you will fall short by INR 7 lakh. In such circumstances, you might think about using other financial tools, such student loans, to pay your bill. You may also opt for the best Child Education Plans to fulfill the desire of your chikd
Save more every year
This is a fantastic tool for achieving your long-term objectives. You can always use the Step-up SIP option to support your goals and save more money each year. Your SIP amount typically increases by x% (you choose this x%) in a step-up SIP. The Step-up SIP is an excellent approach to expand your target corpus later in your goal because your income is probably going to climb by a certain amount every year.
Rebalance
As you make investments, some will perform better than others, and each one has a unique level of risk. Rebalancing is necessary to make sure that your portfolio always reflects your risk, which depends on a variety of variables such your time horizon, income, expenses, dependents, etc.
You might need to re-allocate your investments to another asset class where you believe the returns are fair and appropriate for your risk tolerance. Rebalancing is the procedure that must be followed to make sure that you are optimised each time you are exposed to the market.
Bottom Line
In conclusion, you should start saving for your child’s education when they are young. This will ensure that they have a strong foundation to help them succeed in life.
