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Monad International | 8 things to consider when planning for your child’s education.
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8 things to consider when planning for your child’s education.

8 things to consider when planning for your child’s education.

Plan as early as you can!

As parents, we want what’s best for our children. A world with fewer issues and financial freedom. A solution to many social issues lead to a simple conclusion: education. Yet, we tend to neglect planning for our children’s education. In this article, we go deep into things we must consider to give our children the best possible education.

1. Why is education so expensive?

We tend to still believe that education systems are for the social good. Unfortunately, we fail to see that these institutions have become businesses. Starting in 1998, 5 public universities turned corporate. This was the result of a global trend of which universities turned into enterprises. This trend has led to national policy changes and institutional development. Higher education became privatized and public universities became corporate. It has become a profit-first organization. Now that we understand this we can focus on planning.

2. Local or abroad?

There are many things to consider when it comes down to local and overseas universities. We have managed to narrow down to this.

Most Malaysian colleges provide niche subjects to avoid competition with other colleges. But, institutions in other countries can only survive with innovation and research. Institutions abroad had focused on creating higher quality education. This created the demand for Malaysian students to study abroad. In a nutshell, Malaysian institutions focused on business instead of quality and diversification.

3. It’s expensive, I know. But, I want to know how expensive.

A Levels or Pre-University course could cost between RM19,000 and RM38,000. The total cost for a three-year engineering degree about RM140,000. A HSBC survey found Malaysian parents are spending an average of US$25,479 (RM107,920) on school even before a degree.

4. That’s okay. I can plan for that.

Yes, let’s plan! You must also consider the rate of inflation and the volatile value of the Ringgit. In an interview with the NST, Joanne Lian said the cost of a foundation her children’s studies went up 5% – 10% within 5 years. The debate between local versus overseas institutions is irrelevant in this context. Tertiary education is expensive, period.

5. I have my life-savings to use when the time comes.

A HSBC survey also showed that Malaysian parents are very supportive. Malaysian parents rank eighth out of fifteen when it comes to spending on education. They will provide for their children to reach their highest potential no matter the cost. It is evident that this has pushed parents to dig into their life savings and retirement funds. The sheer numbers for one child are enough to set you back years of investments.

6. They will earn a scholarship or get a loan.

Scholarships are your best bet to decrease the cost of education. Student loans are becoming more of a problem than a solution. This contradicts the head start you intend to provide for your children. Instead, they will accumulate debt the moment they graduate. Focus on both attaining scholarships and on a education savings plan for your child.

7. What else can I do?

Seek external help from a finance expert or financial planner. Money is the game so get someone who knows the game. Having a financial planner arrange your plan will save you precious time that can be well spent with your family. With a strong financial strategy, all you have to do is focus on execution. Take into consideration vacations and other activities required to expand your child’s world-view. Everything will be in your strategy.

8. So where and when do I start?

Right now is the best place to start. It’s never too early or too late to plan for your children. We have come to the conclusion that education is important but expensive. Yet, we follow the system to help our children grow the best they can. As we invest in their futures as well as ours. Plan in detail, execute well and consider as much you can.

If you would like help in contacting a financial planner you can sign up at Smart Finance for a free consultation.

No charge.

We are here to build a better future for our little ones.

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