QUIZ

Are you saving enough for your child’s future?

Tertiary studies can unlock opportunities for your child to succeed, but a good education isn’t cheap. Are you prepared for the costs?

1. The way things are, my child will probably…

A Finish school and work to pay for studies. B Work and hopefully move up the ranks. C Have the freedom of choice to study after school.

2. We’ve been saving for our child’s studies since…

A … they began high school. B Never. C … they were born.

3. If you can afford studies for your child, how long will the savings last?

A Probably the first year or two. B We will have to rely on a loan if we don’t get a bursary. C We have enough saved for three years of study.

4. What savings goals have you set for your child’s future?

A We don’t have a goal – I’m just saving whatever I can. B We haven’t set a goal beyond their matric. C We’ve set a figure, and prioritise that over impulse spending.

5. You’ve spotted a deal on a flat-screen TV. What do you do?

A Tough decision. Those savings are tempting…. B Deals don’t come along every day! C Deals come and go. My child’s education is more important.

6. What are you using to save for your child’s education?

A We’re saving with a normal bank account. B Nothing at the moment. C We have a monthly debit order to a unit trust.

Answers*:

MOSTLY As:

You have the right idea, but consistently saving will be more rewarding. “Make savings a compulsory deduction,” suggests André Wethmar, a senior financial planner at FinPrufeWealth BlueStar, underwritten by Sanlam.

MOSTLY Bs:

Not saving, or not saving enough, could mean you or your child will be saddled with debt. “Pitfalls of not saving include high interest on student loans, and the liability on your child when they start their career to repay debt,” says Wethmar.

MOSTLY Cs:

It seems you are on track to securing a bright future for your child. Keep it up! To optimise your savings, Wethmar suggests reviewing your strategy with a financial planner annually.

3TIPS FOR PREPARING FOR YOUR CHILD’S EDUCATION

+ START SAVING EARLY

The sooner you start, the more savings you can build for your child’s future. “Every month, a small amount with compound interest can get you to the finish line,” says Wethmar. Use our savings calculator to work out how much to put away: sanlamreality.co.za/wealthsense/savings-calculator/

+ PLAN WELL

A financial planner will be able to help you decide which savings vehicle to use to grow your child’s education fund. Book a meeting now: sanlamreality. co.za/contact-an-adviser/

+ DON’T BE TEMPTED “Don’t withdraw money for other expenses during the savings journey,” says Wethmar. This can set you back on reaching your goals.