In many parts of the country, parents often find themselves at a crossroads when it comes to securing their children’s education – especially so paying school fees. Today, we’ll explore why Kenyan parents should embrace saving for school fees and provide strategies for both long-term and short-term savings. By the end, you’ll see how early savings can prevent the burden of expensive short-term loans and discover a valuable solution in the Zimele Education Plan.
Why Save for School Fees?
- Avoiding the Debt Trap: In recent times, loans have become increasingly expensive. Saving early helps you avoid the heavy burden of taking loans, especially mobile loans. These loans can get you into a vicious cycle where you take a loan to pay for school fees and by the time you finish clearing it you need another to settle the next term’s fee.
- Education Inflation: Education is getting increasingly expensive. The higher you go, the more expensive it becomes. Having a plan and saving towards it will ensure your child gets the education you envision for them.
- Financial Security: Education is an investment in your child’s future. By saving for school fees, you ensure that your child receives the quality education they deserve, setting them up for a successful life.
- Flexible Choices: Saving in advance gives you the flexibility to choose the best educational institutions and programs for your child, ensuring they receive the education that aligns with their aspirations.
Strategies for Long-Term Saving
Here are some strategies for Kenyan parents to consider when planning for their child’s education:
- Set a Goal: A common long-term goal can be taking your child to university.
- Make a Plan: Figure out how much you need for your goal and how long you have to reach your deadline. Then find out how much you should be saving to get to that target. You can use the Target Savings Calculator at zimele.co.ke/advisor to make a plan.
- Regular Deposits: Establish a dedicated savings account for education and make consistent weekly or monthly deposits to steadily grow the fund and reach your target.
- Lump Sum Savings: Whenever you come into extra funds, consider allocating a portion to your child’s education fund to accelerate its growth. If you can afford it, save a huge lump sum amount and let the compound interest grow the sum.
- Irregular Deposits: If you don’t have a regular income, you should save a portion of your income wherever you get one.
Strategies for Short-Term Saving
When you need to cover immediate educational expenses, these strategies can come in handy:
- Set a Goal: A common short-term goal can be paying for next term or next year’s school fees.
- Make a Plan: Figure out how much you need to pay in school fees and divide it into the remaining months. E.g. If I need 50,000 in 3 months, I can save 16,600 every month to reach my target.
- Regular Deposits: Establish a dedicated savings account for education and make consistent weekly or monthly deposits if you are able to in order to steadily grow the fund and reach your target.
- Lump Sum Savings: If you are in a position to do so, you can set aside the entire amount and let the interest grow the sum further.
- Irregular Deposits: If you don’t have a regular income, you should save a portion of your income wherever you get one.
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Where to Save?
There are many options in the market but we recommend the Zimele Education Plan? This is because the plan is the only one that doesn’t require you to make a regular, contractual deposit. You can save at your own pace. Any amount at any time.
The funds are invested in interest-earning treasury bonds, treasury bills, and infrastructure bonds through the Zimele Fixed Income Fund. This means your deposits earn interest and it is compounded on a monthly basis. This makes the plan ideal for both short-term and long-term education goals.
Another good feature of this plan is that there are no penalties or restrictions. If you are struggling financially, you can temporarily stop saving and resume when you are able to. No questions asked. You can also withdraw to pay for school fees at any time. So if you are saving for their university education and you need the money to clear their high school fees you just withdraw and pay. No restrictions. No penalties.
Conclusion
Kenyan parents, the future of your children is in your hands. Embrace the power of saving for school fees through regular deposits, lump sum savings, and wise investments to avoid the pitfalls of expensive loans. The Zimele Education Plan provides a holistic solution to ensure your child’s education is a reality, not a financial burden. Secure your child’s future today at https://www.zimele.co.ke/education-plan/ and take the first step towards a brighter tomorrow. Your child’s dreams are worth the investment!
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