September 15th, 2020
Set your Children up for Success
Have you ever caught yourself saying, “I will do things differently than my parents did” when thinking about how you will raise your children now or in the future? You might currently be swimming in student loan debt wishing your parents had set aside some money for your college fund.
This would have alleviated much stress created by the financial burden that accompanies student loans. One thing you can do differently for your children is create and fund an education savings account.
No matter how old or young (or maybe even unborn) your children are, it is never too late to start saving for your children.
Millennials do things vastly different from generations before.
Everything from family structures to career positions to how you raise your children likely differs from how you were raised, and everything is done on a different timeline. According to the CDC website, the average age of first-time mothers in the U.S. was 26.3 years in 2014. The average age has steadily trended upwards since and is likely much higher in 2020. So what does this mean for your children financially?
The later you have children, the more time you have to save for their future. Even if you are thinking about having kids in the future, then it doesn’t hurt to set some money aside and start planning. Creating an education fund sets your children up for success; it ensures the financial ability to attend college and might even incentivise your children to aspire to a graduate degree.
If you have the financial means and save early on, then you may decide to send your kids to private schools for K-12. Many private schools now cost as much as some universities, which some parents have not adequately planned for. In order to plan more effectively, you should evaluate schools in your area ahead of time and decide realistically whether you will send your children to private or public schools. 529 education savings accounts can be used towards primary and secondary tuition.
Creating an education fund is beneficial for both you and your children.
Earning a college degree is more valuable now than ever before and is becoming an increasingly sought after factor in job applicants. Pave the way for your children by creating an education fund. A financial planner can help you decide how to save for an education fund, and most plans even qualify for a tax deduction, which will save you money. Education investments typically grow tax-free and are tax-free upon withdrawal when used for qualifying education expenses. This is a win-win scenario, which your children will thank you for one day.