Studying abroad is a dream come true for many. However, for studying in a foreign university, one has to arrange funds to pay admission fee, tuition fees, buy tickets to travel to the country for admission, accommodation, food, etc.
So, in the absence of scholarships, arranging funds becomes a challenge for the students belonging to not so wealthy families.
The high rate of inflation in the education sector and fluctuation in currency rates make it even difficult to estimate the fund requirements.
However, if parents plan early to provide their children higher education in foreign universities, they would get ample time to invest to accumulate funds.
“The good part about planning for a child’s future to study abroad is that the parent has time in hand to plan their finances,” said Vikas Singhania, CEO, TradeSmart.
By starting early, one may accumulate the required fund by saving and investing smaller amounts compared to accumulating the required fund over a shorter period.
“It goes without saying that one needs to plan and invest as early as possible. The earlier one plans, the more chance of meeting the desired goals. Further, one can avoid taking riskier bets if one starts early,” said Singhania.
To start saving and investing early, one needs to plan early and determine the financial goal properly.
“Many factors will decide the investment planning like a tentative idea of the fee keeping in account inflation, the number of years left to achieve the goal, the amount one is willing to save every month and the instrument to save in,” said Singhania.
“Depending on these factors, one can suitably save and achieve their goal. An amount of Rs 15,000 saved every month for 15 years in an instrument which yields 15 per cent per annum would leave Rs 1 crore in the hands of the parent,” he added.