If you’re a parent to preschool or school-aged kids, then you’re probably feeling the pressure of funding their education. Primary and secondary school are expensive enough, but college is in a league of its own. So, if you find yourself nervously counting out how many Septembers you’ve got left before you send them off to college, it’s time to start planning.
In this article, we’ll look at some of the costs associated with sending your child to college, talk about how you can start building up funds and share 21 tips for you AND (this is the best part) YOUR CHILD to manage college fees and expenses.
So let’s dive straight in by looking at some numbers.
The Average Cost of Third Level Education
The Zurich Cost of Education Survey 2018 estimate the following costs associated with Third Level education in Ireland for the 2018/2019 academic year.
- Rented accommodation – €4,117
- Student accommodation – €3,442
- Fees – €2,419
- Parents financial support – €2,172
- Transport – €303
- With rented accommodation – €9,011
- With student accommodation – €8,336
- Living at home – €4,894
- With rented accommodation – €36,044
- With student accommodation – €33,344
- Living at home – €19,576
Building up funds
If these costs look high that’s because they are! Paying for third level education is a major financial planning goal, and unfortunately there are very few economies of scale to be had by putting more than one kid through college.DOH!
My parents had 3 in Third Level at one stage back in the late 90’s. I am giving away my age but it is important to stress how prepared my parents were back then. They worked hard for us kids. My dad always said if you save 15 to 20% of everything you earn you will always be okay! He was right… They encouraged us to work hard too and save hard.
As a financial planner, the best advice I can give you comes from my father, though it is backed up by my financial planning qualifications too! It’s simple – start saving early. Using your children’s allowance or a proportion of it can go along way to funding your child’s education. If you saved half of the €140 monthly child benefit payment, you would be able to save €70 per month. With the right plan, you would be able to build up a pot of around €20,000 after 18 years.
Of course, not everyone will have the prudence or financial stability to save the children’s allowance from day one. No matter, the key is just to start putting some money away as early as possible so that borrowing does not come into it as a source of financing education.
Involve Your Kids
It doesn’t have to be your sole responsibility to put your child through college. In Ireland, it often feels like third level education is an entitlement. It’s worthwhile helping your child to understand that it is, in fact, a privilege and an investment in their future, not yours! So why not have them take an active role in managing the funding and costs of their third level education.
In my house, for example, we all took up part-time jobs and worked full time over the summer months to help with the costs. We worked in the states for the summers too and knew we were there for a reason; to build up funds for the year ahead.
Before you’re ready to take pictures of them in their graduation gown use these 21 tips to make the most of how you plan with your children to save for college.
Be Smart with a mix of Clever Saving and Student Scrimping!
Here are 21 Tips for both parents and children.
- Goal Setting – Set realistic savings goals.
- Balance how you save – between short term, medium and long term objectives
- Keep saving even when they start college, you never know what additional costs might occur; a masters or Phd.
- Help your children plan their meals for the week when they are home for the weekend, it saves them time and money when they are back at college. Make sure they never go grocery shopping when they are hungry. Avoid buying name brand items. Purchase own brands whenever possible. They are exactly the same item, at a highly reduced price. You can even check the ingredients to make sure!
- Educate your children on the value of money – money is hard earned and not to be wasted.
- Cut out vices – smoking and binge drinking are terrible for you and expensive.
- GAP YEAR: There is no rule saying that every 17 or 18-year-old has to go straight to College. In the USA many high school graduates live at home for a year and work as many hours as they can to save money for college. Even if they only bank $10,000 in 12 months, that money represents loans they won’t have to take out later or money recieve from their parents. Meanwhile, data shows that older students tend to get better grades than 18-year-olds away for the first time. A year of experience may also help in their career later.
- Buy or rent used textbooks and sell last semester’s books back.
- Don’t make impulse purchases.
- Always pay bills on time to avoid late fees, If you have a credit card, pay it off as quickly as possible.
- Walk, use public transportation or take a bike instead of having a car.
- Consider more basic phone packages or plans.
- Shop where they offer student discounts. There are so many places that offer discounts to students with College ID.
- Look into a campus gym, Many colleges offer memberships for free or at a reduced rate for students.
- Don’t buy unnecessary supplies. Why buy cumbersome refill pads when you can type on your laptop?
- Don’t buy books you will only need for a short period of time – check them out from the library instead.
- Take advantage of what your Students Union have to offer when it comes to activities.
- Drink water. It’s free and better for you, anyway.
- Make your own tea and coffee. Great savings here.
- Don’t buy music. Use the free services like Spotify offer.
- Holidays – only when you can afford to go.
Don’t expect thanks until your children are much older
I’m a 37 year old child and only through writing this article am I truly realising the sacrifices my parents made for me and my siblings. Whoops! I forgot to acknowledge this or say thanks before now! So to throw some life advice on top of the financial planning advice I’ve shared here – don’t look for any gratitude until well after graduation! But know, when you see your child being conferred that at least part of the scroll in their hands was earned by you, pun intended!