Heading to 3rd level education has taken on a very different form these days, and it might still be a few years away for your youngest child but one thing you can probably rely on is that the bill isn’t going to get any smaller, so the sooner you start saving the better.
Depending on how near your child is to starting 3rd level, you could decide to stay with a simple deposit type savings product, or if your goal is 5-7years away, then an investment might be a preferable option.
Saving means putting money aside, gradually, in a bank deposit or regular savings account, and earning interest. People generally save for a particular goal, like their children’s education costs, knowing that their capital is not at risk in the short term if you need to draw on it.
In today’s current environment, with interest rates at a historic low, deposit accounts may not earn interest. It may even end up costing you money.
Investing typically means committing your money for a longer period of time in the hope of getting a better return than you would by saving in a deposit account. There is risk involved, but you can choose the level of risk you are comfortable with. There is usually no guarantee that you will get a return on your money or that you will get all of your capital back. However, depending on how your investment performs, you could potentially get a higher return from investing than you would from saving.
Saving and investing are both good ways to grow your money but they are quite different. There are many questions you could ask yourself to determine which option is right for you, but importantly, when saving for the cost of your children’s future 3rd level education, the question of when you will need to access it is key. How many years is there until your child starts 3rd level? If you think you might need it within 5 years, you might want to consider savings accounts. If you think you won’t need it for 5+ years, you might want to consider an investment.
The cost of a good education
Did you know that the cost of a 3rd level education can range between €6,000 and €12,000 a year*, depending on whether your children stay at home or live away from home?
So you could be looking at a bill of around €36,000 per child for a 3-year course and €48,000 for a 4-year course.
The good news is that you still have time
Figures like this may sound daunting, but you still have time to get some or all of the money together.
By committing to saving monthly into a deposit account or a regular savings account you’ll be in a better position to support your children when the time comes. You’ll also have greater peace of mind knowing you’ve a plan in place for when the bills start to land.
You can find more about Bank of Ireland saving accounts here.
Investing your money
If you have a long time before your children go into further education, you might consider investing your money instead.
If you can commit to investing for more than 5 years, there are a range of options for you to choose from which could potentially provide better returns than deposits in the longer term. Finding which one is right for you is really important and we are here to help.
Making Investing Easier
At Bank of Ireland, we make investing in funds straightforward and accessible. Whether you’re new to investing or a more experienced investor, we can develop an investment approach to suit you and help you choose an investment fund that fits the amount of risk you’re comfortable with. Click here for more info
Find out more
A financial planning manager can take you through everything you need to know using the very latest screen sharing technology, perfect for today’s norm of virtual meetings.
Investment Product Warnings:
* Source: https://www.dit.ie/campuslife/studentsupport/costoflivingguide/
Disclaimer
Life assurance and pensions products are provided by New Ireland Assurance Company plc., trading as Bank of Ireland Life. New Ireland Assurance Company plc., trading as Bank of Ireland Life is regulated by the Central Bank of Ireland.
Advice on Bank of Ireland Life products is provided by Bank of Ireland, trading as Bank of Ireland Insurance & Investments. Bank of Ireland trading as Bank of Ireland Insurance & Investments is regulated by the Central Bank of Ireland.
Bank of Ireland is a tied agent of New Ireland Assurance Company plc trading as Bank of Ireland Life for life assurance and pensions business.
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