In today’s world, a good education can be extremely expensive; but we all want our children to have access to the best opportunities. However, more often than not, we see many parents end up paying for their children’s education with the money they had saved towards their retirement. Sometimes, parents also choose to sell their property or other assets to be able to afford the best when it comes to their child’s higher education. But does it always have to come down to this? Is there a way that you can have a good retirement and ensure that your child can meet their educational goals as well? The answer is yes, but it requires systematic planning.

• The earlier you start the better:

When it comes to investing for your child’s education and your retirement, the earlier you start the better. This enables you to use the power of compounding to its fullest, and set a reasonable time frame to actually meet your goals. While retirement planning should start as soon as you secure your first job, it is good to begin considering your child’s educational goals as soon as the child is born. This will give yourself ample time to plan towards your child’s higher studies.

• Evaluate your requirements and invest accordingly:

While thinking about your retirement, you may have a clear understanding of what you want. However, it may not be as straightforward to visualise what your child may want to study once they turn 18 or account for the increasing cost of education accurately. So how can you be prepared for both? This is where starting early can be extremely beneficial. When you are saving for your child’s higher studies, you can take advantage of growth assets like equity – which perform better in the long term – to generate sufficient wealth. Similarly, in addition to opening a Public Provident Fund account, making contributions towards the National Pension Scheme and annuities, incorporating equity investments can be helpful while planning for retirement. Moreover, since it is a longer investing horizon, you can expect higher returns. 

• Don’t make unreasonable decisions: 

Both your retirement and your child’s education are extremely crucial goals, and this is why it is important to plan for them separately. If you have started planning early enough, you will have a sizable corpus to ensure that the two don’t affect each other. When it comes to deciding the course, country and college for your child’s higher education, make reasonable choices within the limits of your funds. Remember that an education doesn’t have to be extremely lavish for it to be meaningful. But at the same time, by planning well, your child will have sufficient freedom to achieve their goals and you won’t affect your retirement in the process.

• Work with a professional:

Since identifying the appropriate investment opportunities that align with your goals well can be difficult, it will be a good idea to consult a professional financial advisor. Working with a certified financial planner or a wealth management firm can help you plan for both of these goals effectively. Subsequently, working with a professional will ensure that you don’t make any costly mistakes which could deter your ability to make these goals a reality. Furthermore, in today’s world, there are no excuses left to avoid seeking the advice of a professional when it comes to your finances, as it has become extremely affordable and will definitely be to your benefit. 

So keep these points in mind, and you won’t have to resort to paying for your child’s education at the expense of your well deserved retirement. By planning efficiently, you will surely be able to meet both these goals comfortably.