Every athlete aims to win a gold medal at the Olympics. Every entrepreneur wants to reach the pinnacle of success. Every parent wants to provide the absolute best for kids. Especially when it comes to honing knowledge.Indians place excessive importance on education and raising sky high achievers. 

Cost of quality education in India is getting expensive with every passing day. With global degrees currently seeing a greater demand, many parents are going above and beyond their means to ensure they can fulfill their child’s dream education path.

Giving your children the best in education should not become a financial strain or debt trap for you. Here’s how you can plan funds to meet all the expenses towards your child’s education goal.

1.Do The Math 

The first step to plan for your child’s education is to see what is the cost of the course today that your child wants to pursue. The cost needs to be grown to the year of education by taking into account the education inflation. Along with your child’s education goal, do not forget your other goals. It is important to strike a balance between all your priority goals.Time horizon is a key determinant in ensuring your goal is achieved. The sooner you start investing, the longer timeline you’ve to meet your needs. 

2.Formulate An Action Plan

If your child is 8 years old, wants to pursue an engineering degree abroad, you need to set aside funds for college fees plus other expenses such as lodging, meals, travelling and more. 

Basis your risk appetite and savings, you need to start investing to achieve the required corpus in the year of education. 

If the education costs Rs.38.5 lakhs today, then after 10 years the same will cost ~Rs.1 Crore, with 10% inflation.

To create a corpus of Rs.1 Crore after 10 years, you need to invest ~Rs.55,000 monthly, basis return of 8%p.a. (this will change basis of your risk appetite). Investing early has a lot of benefits. Therefore, start as early as you can. 

3.Draw The Line

Don’t be strained, if your finances don’t allow. Draw the line, where necessary. It’s important to assess your assets, liabilities and other priority goals. 

One can also consider taking an education loan. But one really needs to do the math as to how much loan one should take. As the EMIs should not strain the cash flows.

Before you commit to any loan or make an important financial decision consult your financial planner. Take into account all upcoming expenses, future needs, goals and emergencies. Make sure you have your savings and emergency fund in place. To meet one goal, you don’t want to hamper your financial health. 

4.Meet The Advisor

Decisions are often clouded by emotions. When you are overwhelmed, you tend to make money moves that are more gratifying than practical. To ensure your financial health is always good, make sure you are making rational and informed decisions, onboard a well educated and insightful financial planner. Let them guide you through your financial journey and help you accomplish your coveted goal of providing your children with an education degree – you dream of. 

Back in the school days , Remember, how the physical educator would prepare the students for the parade march. Two words – Attention and At Ease were loudly heard. Does the word Attention bring back memories? That’s exactly what you need to do. Pay attention to your financial planning route, invest in a disciplined and systematic approach, so you can be at ease about your child’s education expenses.