Financing Your School Year Donegal
You’ve spent money on your children’s new textbooks for the following year (or maybe second-hand since it is less expensive) as well as their new clothes – my, haven’t they gotten bigger? And you’re wondering how you’ll pay for the rest of this school year’s miscellaneous costs.
The start of the school year is great for children and parents alike, but it unfortunately comes with added expenses. If your monthly costs are eating up more than your income, you only have two choices: make more money or spend less of what you already have. While increasing your earnings isn’t always an option, we do have four tips that could help slash your spending.
1: Plan
Financing Your School Year Donegal
It’s especially crucial to plan your finances right now. My suggestion is that you sit down for a few hours every month. You’ll need a roadmap, and you’ll have to anticipate issues along the road. So, make a list of all current expenditures for the kids (transportation expenses, lunch costs, additional books, school trips, sports equipment, extracurricular activities). Consider how you might save money in other areas such as lunches and after-school programs.
Consider if there’s a less expensive alternative, such as carpooling, when assessing the costs. Some parents offer their kid up to €10 per day for lunch allowances. A packed lunch may be prepared for roughly €3 each day, saving more than €1,200 annually!
Your child will have something to say about this one, no doubt.
2: Saving for college fees
Financing Your School Year Donegal
A good rule of thumb is that if you send your child to a fee-paying school, you will need around €240,000 by the time they finish third level education. This covers tuition fees which can be up to €42,000. Before beginning, it’s best to have a financial plan in place so that you are prepared for this eventuality. One way could be saving the Child Benefit (currently €140 per month per child) into a Regular Savings account
Even if you only invest €250 a month from when your kid is 5 years old until they turn 18, at 3% annual growth, you’ll have saved enough money to cover the cost of third-level education in Ireland.
3: Borrow
Financing Your School Year Donegal
In order to fund their children’s education, some parents must borrow money for their additional expenditures each year.
For this you should shop around; credit unions, banks and An Post Money who currently offer a low Fixed interest rate from 5.9% APR, (correct as of 06/09/2022)
Check with your local Credit Union office because they are all independent, but may have low interest rates if you take out an education loan.
To qualify for a loan, Credit Unions require you to be a member for at least one month and deposit 2.5% of the sum you want to borrow into a Credit Union share account. Check with your Credit Union for their terms and conditions.
The next stage are banks that know they’ll have a greater chance of approval. Only borrow for a year – school expenses are recurring every year. Unlawful moneylenders should be avoided at all costs, owing up to 200 percent or more in interest fees.
Warning:
If you do not meet the repayments on your credit agreement, your account will go into arrears. This may affect your credit rating, which may limit your ability to access credit in the future.
4: Protect
Financing Your School Year Donegal
It’s crucial to think about life cover as well as income protection, if one or both parents are unable to work, all your financial goals will be adversely affected, and your savings plan could get derailed.
In general, a life policy for the specific amount needed with a duration to correspond with the end of your child’s education should be put in place. This pays out a lump sum if you die and is quite cost-effective.
This coverage should stay in place until your youngest child has completed their third level education. Any Death in Service benefits provided with your employment can be taken into consideration, (you should inquire about this with your employer, or review your contract of employment)
Income Protection replaces a percentage of your income when you are unable to earn it.
Having your income protected will provide peace of mind knowing your children’s savings plan can continue to be funded even if you are unable to work.
I can tell you from personal experience that the years fly by at a rapid pace. It appears to me that I was only yesterday walking my youngest towards his first day of school, and now he a full-grown man. So, make the most of your time!
Start a habit of saving money by calling one of our specialists at Advice First today. A little self-investment goes a long way!
If you have questions or need advice on Financing Your School Year, call 074 9103938 or email now
Get Advice
Talk to us now and make an appointment with one of our Letterkenny team of QFAs. We are here to help with your Financial Planning Concerns. Ask us questions on Retirement & Pension, Life Insurance & Protection, Mortgages, and Investment Advice. Get in touch here or give us a call at 074 91 03938.
Financial Services firms in Ireland are regulated by the Central Bank.
For the latest updates and financial news, connect with us on Facebook and LinkedIn.
