As with most things in life, planning ahead is essential to achieving one’s goals. As the saying goes, an inch is a cinch but a yard is hard. Regardless of what it is you’re saving for the time frame and the risk level are important considerations in any plan. In plain language, the earlier you start, the less aggressive you need to be to accomplish your goal. This holds true whether you’re saving for retirement, buying a home, a special trip or proving a child with the best education available. Every parent dreams of giving their children the best start in life. After good health, providing your child with a good education is a top priority.
The cost of post-secondary education continues to rise, and the job market is becoming increasingly competitive. Now, more than ever, it is critical to ensure that your children or grandchildren can afford access to the best schools so they’ll be able to successfully compete for good jobs. Including tuition and living expenses, the annual costs of university education can exceed $50,000 per year. Factoring in inflation, by the time your child is ready to go to university these costs could be much higher. People that start saving early on will reduce the future burden on both themselves and their children. Mount Equity Group can help you create a strategy to ensure your children get the chance to reach their full potential. Together, we’ll give your kids a leg up in life.
The power of investment compounding means that by starting early, you can substantially reduce the amount you need to put aside every month in order to ensure that you’ll be able to pay for your children’s education. If you have multiple children in university at the same time, you’ll reduce the financial impact. We recommend discussing this with your MEG advisor when making your overall investment plan.
It’s not necessary to lock in funds in order to save and invest for a future goal. Whether you work with your MEG advisor or someone else, choose a solution that can be applied elsewhere, such as buying real estate, paying for a child or grandchild’s wedding, contributing to your retirement or funding an extravagant trip. Properly done, effective investment planning should improve your life, not tie you down.
The first step is to speak with your Mount Equity Group adviser. You make an estimate of what the expenses will be, and when. Your investment or financial adviser will work backwards to calculate how much you’ll need to put aside on a monthly basis, assuming a set rate-of-return, in order to have enough to cover the expected costs when the time comes. The key, as with other types of investing, is to start. The earlier the better, but better late than never. We’ll work with you wherever you are.