By Sylvia Juuko
For many parents, the back to school season can be challenging, particularly if they did not pay attention to planning for the costs of education.
While dealing with locating the right school and the materials needed to take them through these stages may be overwhelming, the overall cost remains the biggest challenge.
Next to home ownership, financing your children’s education could be the next big expenditure you have to deal with. While it may not be possible to accurately determine the cost of education, you can minimise the anxiety if you plan and work on your capacity to finance this expenditure.
Ideally, the planning should start way before you start a family. If you already have a family, it’s not too late to get back to the drawing board. Saving and investing will allow you manage this cost.
For starters, hold a discussion with your partner regarding the kind of education your children should have. Once you agree, consider the location of your home and the schools available to determine the costs involved from day care and the subsequent stages.
For example if you reside in Entebbe, will it make economic sense to ferry your child to a day care centre or school in Naguru? Are you ready to shoulder the costs of transport, time in traffic and wariness on you and the children?
Save and invest
Once you have an idea about what you want for your child and estimated the cost, contrast that with your income. From the current and projected income, determine and agree how much you will need up to university.
Many families have chosen to set up an education fund where a percentage of their income is periodically set aside.
I know a couple of parents whose education fund can cater for their children’s education up to university irrespective of whether the establishment is local or abroad.
Make sure that this fund is fetching some reasonable interest rate per year. You can negotiate the amount with your banker.
If you are an astute investor, some of this can be invested to achieve growth and higher returns.
Shop in advance
Once you start a family or are a guardian, anticipate the costs and deal with them before the school term.
Depending on the age of the child, you have an idea how many times in a year a lump sum payment for tuition and essentials are needed.
These prices will continue changing as the years progress and this has to be
Saving and investing will allow you manage the cost of your children’s education
factored in when making contributions to an education fund. This fund is vital in beating the rush associated with the back to school season. If fees payments are done in a lump sum, it eases the financial pressure.
Once the children get to a stage where they appreciate money, talk to them about the fact that a new year/school term should not necessarily translate to new items for school. Recycling items that are still in good condition is one way to save costs.
Engage and involve children so that they appreciate and value money to avoid being wasteful.
The other option is to engage with parents who have successfully handled this aspect of funding their children’s education to get some practical ideas on what has worked for them.
Lack of proper planning and a low income base will force you to adopt the habit of borrowing to finance tuition and other costs.
Avoid the temptation of choosing schools that your finances cannot support simply because you need to keep up appearances. You will end up borrowing to finance an expensive trip abroad that schools organise for students.
Remember, your financial decisions (especially the bad ones) will soon come back to haunt you.
Be true to yourself by appreciating your financial status and the kind of lifestyle it can support. That way, you save yourself any hardships by living within your means.
The writer works with Bank of Uganda