Cynthia was famous throughout the four walls of the University of Ejigbo. At age twenty-two, she broke the institution’s all-time record by emerging the best graduating student with a perfect Grade Point Average of 5.0 from the faculty of Medicine and Surgery. Before then, at age fifteen, she was best in JAMB the very first year she sat for the exams. This was why no one was in doubt when the Register of the University, Prof. Adewale called her “Our shining star” while reeling out her achievements to the awe of the audience seated in the school’s convocation auditorium.
“Can you briefly tell us the secret of your success?” Prof. Adewale asked as he presented the award of N10 million to her courtesy of the state Governor.
“My mother,” Cynthia replied.
“Why your mother?” the Professor enquired.
“Because, despite being a single mom, she made sure that my education was her top priority.”
Cynthia then pleaded that her mom be brought forward to the podium to accept the award with her. Her mother wept uncontrollably when receiving the award with her daughter. She spoke less but was proud of her daughter’s achievements.
In all sincerity, Cynthia was right. Despite life challenges faced by her mother, she made sure that her daughter was given the best care and education. One thing Mama Cynthia did right was ensuring her child’s education. Just as she did, you too can do the same for your kids! In this blog post, we’ve compiled the 5 best ways to insure your child’s education.
Let’s get started.
1. Open a Children Education Fund
The Children Education Fund (CHEF) allows parents to save money for a child’s education with tax-deferred or tax-free growth potential. It assists in providing a lump sum over a period of time for the education of one’s children/dependents. The minimum annual contribution is N60,000.00 with flexible payment stretched monthly, quarterly, half yearly or yearly. Once the policy holder dies during the agreed period, the account fund balance including the sum assured on the plan (outstanding premium as at date of death) is paid to the named beneficiary. But, if there is no death, the policy holder gets his total contribution with accrued interest at the expiration of the agreed period.
2. Consider a Cornerstone School Fees Guarantee Plan
Investing in School Fees Guarantee is a great way to insure your child’s education. This unique insurance plan covers parents as their children progress through the foundational educational system (primary and secondary school stages). It protects the insured’s child or ward against unwanted and unexpected interruptions to their educational aspirations, either caused by job loss or untimely death of the fee-paying parent. Proceeds from the policy are paid directly to a school rather than to individuals which guides against any taxation obligations associated with a deceased estate. Additionally, premium is payable at the beginning of every session/school year.
3. Look into Getting Life Insurance
Many Life Insurance policies can be used to plan for a child’s education, with the death benefit providing the funds needed to pay for school. Payment of a guaranteed lump sum is given to a named beneficiary in the event of the unexpected death of the policyholder within the period/term specified by the policyholder.
4. Invest in FGN Bonds
FGN bonds are issued by the federal government of Nigeria and can be redeemed for interest payments and school tuition. The FGN Bond is regarded as one of the safest types of investment since it’s supported by the ‘full faith and credit’ of the government. Since it doesn’t contain any default risk, your interest and principal will be paid as and when due. The income you earn is also exempt from State and local taxes.
5. Invest in Stocks
Investing in stocks can help insure your child’s education and provide a source of income that can be used to pay for tuition and fees. Stock market investment is a long-term process that could help you manage your finances. There are higher possibilities of getting higher returns to your investment and to develop financial discipline. To begin investing, you must open a trading account with a broker or a stock brokerage firm.
Behind every successful child are the unseen caring hands of the parents. Investing in your child’s education is a great way to secure their future and provide them the right platform to excel academically just like we learnt in Cynthia’s case. The five ways to insure your child’s education that we discussed provides a range of opportunities to create long-lasting wealth. However, note that investing in children’s education requires due diligence, excellent planning, and parental sacrifices to ensure success.
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