August 23, 2012

The importance of financial backing in modern university studies

The cost of studying at university has increased significantly in recent years, leading many families to devote at least some of their resources to helping their children attend further education.

In a competitive employment market, the role of qualifications and skills in general becomes ever more crucial; a concept that is not lost on people keen to see their younger relatives get the best start in life.

Of course, not every young person will want to go to university, so there may be an equivalent use for the money; perhaps to help them undertake an extended period of unpaid work experience to help increase their career opportunities.  If you are keen to provide financial backing for your child or grandchild’s education then you should think about how you will be able to fund this.

Put money aside

If you don’t have a significant amount of savings available, there are a couple of options you could consider such as:

* Putting aside cash little by little over the long term, or
* Ensuring that you have a sufficiently high income at the time it is required to enable you to fund your family’s education.

The latter is great if you can manage it, but relies on you being able to secure a good monthly income and making sure you are in that position when your child or grandchild decides they want to study.

In contrast, a long-term savings option could allow you to build up a lump sum over time. So if you know it is at least ten or 15 years until your child or grandchild will be eligible for university, then you can sign up for an account that aims to steadily build up your funds, such as a guaranteed savings plan.

How to mention it

One potential issue is that a teenager may not always be the most sensible when presented with a large quantity of money, so you need to think about how you will tell them that you want to help.

Each case will be slightly different, but it is probably best not to simply say that you have a lump sum of money waiting for them, since they may try to persuade you to let them use it for something less productive. One good approach could be to let them know that you will support them if they want to carry on into further education or training, without mentioning anything about the amount of money you have saved.

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