financing education
i should have thought of it earlier, but as education is free in germany, it slipped my mind. i forgot that we are probably one of those families who aren’t rooted to a certain place. not just yet. or maybe never. at any rate, there’s no telling where jan will go to school. and college? sure, but that’s more than a decade from now, we can be anywhere in the world by that time.
education plays first priority in our books. if we had the money, there’ll be no discussion: jan will go to an international school. except for homeschooling, it’s the only option that can offer him the flexibility a nomad needs. internationally accepted standards, plus the possibility to hop in and out of schools in different countries without major adjustments and timing issues to think of. it’s the only logical choice.
but arrrgh, we can’t afford it. we’d gladly scrimp on everything else if it’d secure jan a place in an international school, but no amount of balancing of books and tightening of belts will end us with a pool of money attending such a school will require!
and that’s just primary and secondary schooling. what about college? i have been browsing baby center’s recommended tips for saving for college education, but it seems that the programs are only for US residents. sure, there are also financing plans in the philippines similar to the 529 plans, but which are privately-run and are not state-supported. however, i’ve been hearing a lot of news lately about plans that do not materialize, so after much consideration, it’s a risk i’m not sure i’m willing to take.
seems that although it probably won’t give the best return-of-investment, the safest way to save up for a college education (or any purpose, for that matter) is thru the banks. we do have a a small savings plan to which hubby’s employer also deposits a contribution, but who knows if that will suffice?
am now looking at the ayala life fund (thanks noemi for the link!), but i think i need someone to explain to me how it works. something to do next time i visit home.
what about you? what sorts of investments are you putting your eggs on?
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15 Responses to “financing education”
June 27th, 2006 at
Retirement and college funds, in that order. I read somewhere that parents should make sure they have some funds for retirement before they put away money for their children’s college. Ang logic, puwede naman magtrabaho for college ang anak, pero ang magulang, kung walang retirement funds, paano? Di naman puwedeng magtrabaho forever. What we did, we gave our retirement funds a head start bago kami tumingin ng college funds. Then we got educational funds na flexible, yung basta education-related, puwedeng gamitin ang funds. Yung iba kasi, for specific colleges or locations lang. Too limiting, sabi mo nga. Malay namin kung nasaan na kami by then.
June 27th, 2006 at
Ruth, look into investment companies or talk to a financial advisor. Go with a reputable company and you can be sure that your investments are safe. At the very least, you can start a mutual fund for jan’s college fund that you would put a monthly payment into. The return can be really very good. You’ll have to ask your financial advisor about taxes on this type of plan. And be aware that some educational plans require for you to use the fund in the same country, not so with mutual funds. But again, its taxes you’ll have to clarify. I believe you get taxed when you take the money out.
A financial advisor may still be able to point you to investments that are education-friendly and minimize the tax burden.
Good luck!
June 27th, 2006 at
Here’s an example of what I mean. Maybe talk to several in different countries?
Ameriprise
June 27th, 2006 at
Okay that didn’t work. here: http://www.ameriprise.com/amp/individual/planning-advice/saving-edu1.asp
June 28th, 2006 at
Wow tintin, thanks for sharing this link with us! Looks very interesting.
June 28th, 2006 at
maricar, makes sense about the returement funds. ahh, hubby and i really have to sit down and talk about our finances soon.
tin, thanks a bunch!!! yeah, we’ll have to check country-specifc details. and whether we can continue a plan if we relocate. again, thanks!
June 28th, 2006 at
i’ve been doing some research on these things lately too. I actually sat down with one of the Financial advisors here at work about educational fund and retirement as well. pero, like you said…more on a US-based family ang programs ng karamihan.
btw, tin…thanks for sharing. i’m gonna read more on that later tonight. the more information, the better naman eh.
June 28th, 2006 at
well, goodluck in finding the right spot for your eggs*
incase you do go for eduplans or something similar, make sure that whatever happens to the payor/s, the plan would be considered fully paid.
I’ve invested in ALFM, and so far, for the past 2 years, returns have been good. It’s like saving in the bank too but just with higher returns due to the share values.
June 29th, 2006 at
Ruth, I was in the same situation a few months ago. Well, I wasn’t looking into international schools but more into private schools and the cost shoots up to the roof as well.
I read some articles on how to save for your child’s education cause property investment here in Sydney aren’t doing well lately, that’s why we were looking into putting our money elsewhere.
Try considering talking with a financial adviser to help you understand more on managed funds, blue chip, insurance bonds, trust funds (just be careful of any tax implications).
Kung pwede lang itanim sa paso ang pera anoh? hehehe!
June 29th, 2006 at
hi ruth, here in canada naman, the gov’t is encouraging the people to save for their retirment thru RRSP (Retirement Savings Plan). basically, we put a certain amount of our income in RRSP and the gov’t gives back tax refund. we, in turn, put it back in our nest eggs. we make it a point to diversify our investments. rule no.1 is not to put everything in one basket. now that our retirement has been taken care of, our focus this year is our kid(s) education.there’s another gov’t plan which is called RESP. educational plan for kids naman. we receive a certain amount of benefit from the government for our baby and we put it in her RESP. i’m still muddling my way on this so i can’t really fully explain it here. but all in all, everything is good. what hubby and i aim is to have financial freedom for us and our kids. we don’t want them to be burden of caring for us financially during our sunset years and at the same time, we want them to pursue their dreams without worrying about finances.
June 29th, 2006 at
Er, do DVDs or travel count as an investment? I’m so overwhelmed with this post and the comments. I should start looking into a retirement plan.
June 29th, 2006 at
des, hirap pag paliopat-lipat ng tirahan, no?
justice, ikaw pala ang may ALF, eh. so how does it work, basically? kahit pvt email na lang, pls.
maan, hm, seems like we really have to look for a financial advisor. haaay, hirap no?
misis14, the german gov’t has a lot of similar programs, too. ang problema lang is we’re not rooted here
and if we don’t pay taxes here, naturally, the benefits diminish.
haha, yupki, maybe it’s the age. thinking of these things makes me feel old!
June 29th, 2006 at
hi ruth, take a look at this http://www.hsbctrinkaus.de/global/tiles/display?def=01,02,01. it might be of help with your situation.
with canada’s RRSP, it is an investment plan. we save our money there without the gov’t taxing us with the gains. pero if we withdraw the money before retirement, then it will count as income therefore taxable. it is also flexible so wherever we will be in the future…we can make ‘dukot’ in our investments.
June 30th, 2006 at
Investment, retirement, educational plans…they’re all too complex for my pea brain. For now we do the conservative way, and that’s investing in CDs and bonds, plus the regular savings na madaling madudukot. We also have the TSP (thrift savings plan) offered by the military. We plan to diversify someday and be more aggressive, but we have to educate ourselves first.
*Buti pa ang pera, may tao. Ang tao, walang pera*
July 4th, 2006 at
that’s one thing i have to discuss with frenchguy too..education is free here too, but like you, we could be living elsewhere in the future..tho our company guarantees the education of the children during expatriation, but who could say that we would still be in the same company in the future, thus the same benefit? right now, our money goes to property and bonds, + a lil money available in the bank. company helps in paying our retirement..but yes..nothing concrete for education…isip isip..