Have you started setting aside money for your children’s education?
If this is the case, read this article to get some tips on doing it (even on a tight budget).
When we become a parent, we want to give the best to our children. It’s hard to learn that you may not be able to afford their education.
But how do you put money aside for something that seems so far away?
The challenge is even more significant when events like the COVID-19 pandemic strain our finances.
Not to mention current expenses!
Here are some great ideas to help save some money for your kid’s education:
Open a Registered Education Savings Plan (RESP)
The RESP is the easiest way to build capital for your child’s education.
What is it about? The RESP is designed to help you save for a child’s post-secondary education, tax-free.
From a tax perspective, it’s when you take the money out of the plan that you benefit. The amounts withdrawn will be part of your child’s income, which will be lower than yours.
What if you don’t think you can afford an RESP?
What many parents don’t understand is that RESPs are flexible.
If you’re not prepared to invest $20 or $50 a month, that’s okay. Wait until you receive cash from an extra shift or commission. You can then make a single payment!
If your budget is tight, you can start paying $5 or $10 per month. You can always increase this amount when your finances allow it!
Make Automatic Payments
Make automatic periodic payments to the RESP from your bank account if you can afford it.
Reduce Spending On Social Activities
Life resumes its course, but we still need to respect physical distancing. We need to stay in our social circle at events or gatherings.
So you may be reluctant to send your child to a play center. You have given up on throwing a monster party for his birthday.
The advantage is that you will surely save money…
You might have spent between $200 and $300 on your child’s birthday party. If you throw her a virtual party today (which is smaller), it will cost you $50 or $100 instead.
You will be able to put what you have saved into your child’s RESP.
This amount will immediately appear in the account without you having to sacrifice the party!
Did you get into baking during the months of confinement? This is your chance to save even more by baking your cake instead of ordering it!
Ask Your Family To Contribute
Birthdays, graduations, and holidays are the perfect time to encourage grandparents and loved ones to contribute to your child’s savings. It’s a great way to replace traditional gifts!
Your kids may not like this gift very much!
For a baby, that’s not much of a problem. But the older ones will probably want to receive something tangible.
Prefer Day Trips To Long Vacations
Vacations can siphon off a mountain of money in a single week between airline tickets, hotels, and restaurants.
Some families don’t go on vacations!
Instead, they visit their relatives and spend days at amusement parks or by the pool to save money for their kids when they grow up.
Make It a Productive Summer Vacation
Online summer schools are an excellent opportunity for young people to build up early credit. Your child doesn’t have the same pressure then as during the year.
School and these courses are inexpensive. But you can also encourage your child to work.
Students must work in the summer and put money aside. It teaches them the value of money and how to be responsible for their things!
Don’t Invest Too Much In Baby Toys.
If you have a baby, pay attention to your chives of toys. There are many options available on the market to meet your budget and your baby’s needs.
Also, make sure not to get TOO many toys at a time!
Babies grow up fast, and they get bored quickly. So picking small, suitable, and affordable toys is an excellent way to save your money for other things or future needs.
Related: Best Toys For Babies 0-12 Months Old
Dema JS is the founder of newbabysmell.com and a mother of two little kids. Dema had her MBA from St. John’s University- NYC in dual concentrations: Executive Management and Marketing Management.