A balanced plan to secure your child’s future
Planning for a child’s financial future may seem challenging for many parents, especially as they need to balance this with meeting their own financial goals, like growing their retirement savings.
Mdm Chang and her husband have taken steps to address these issues by growing their savings, managing their expenses and using available tax reliefs and rebates.
Building up savings
Topping up the Child Development Account (CDA) to the maximum amount has enabled Mdm Chang and her husband to grow their children’s savings faster.
The CDA is a special savings account for newborns that features dollar-for-dollar matching from the government. The CDA’s interest rates are also higher than those of deposit accounts available currently.
Hence it is a good idea for parents to save in their children’s CDAs especially since they enjoy high interest rates.
As a parent, you are also entitled to the Parenthood Tax Rebate, which you should claim if you haven’t been doing so.
LONGER-TERM PLANNING
To grow their savings over the medium and long term, Mdm Chang and her husband are also using a mix of investment-linked plans and regular savings plans.
In Mdm Chang’s case, her regular savings plans also provide additional protection coverage for her children in terms of insurance.
Setting aside relatively small amounts of money each month helps to grow your savings. The payouts at the end can help pay for your children’s tertiary education needs too.
SHAPING YOUNG LIVES
It’s understandable for parents to feel that enrolling their children in extra classes will help them get better grades to succeed in life. A good education is crucial but it’s also important not to enrol our children in so many extra classes that we hardly spend time with them.
Making time for children gives parents the opportunity to guide and instil good values in them so that they grow up to be well-rounded individuals.
There are other ways to define success in addition to academic qualifications, and perhaps this is one of the most important lessons that a parent can teach their child.
