17 August 2011
Educating to save as well as saving to educate
Urgent and significant attention needs to be given to those saving for further education according to Martin Shaw, Chief Executive of the Association of Financial Mutuals:
“With the introduction of new tuition fees it has never been more important for parents to start planning towards meeting the cost of education. However, what children need today, just as much as saving to educate, is educating to save. This point is made more prescient with the recent research from the Personal Finance Education Group showing that over half of all teenagers are in debt by the age of 17.
“Additional student loans will only exacerbate this issue unless there is a plan in place from an early age especially as students starting University in 2012 could leave with debts as high as £50,000*. For example, if the parents of a student starting university this year had put aside £50 a month from birth, they would have accumulated over £20,000 in savings. Most importantly, they would have helped to demonstrate the value of financial planning and responsibility.
“There are many options open to parents looking to save a regular sum for the long term. Many friendly societies offer Tax Exempt Savings Plans, and from November this year it will be possible to open a Junior ISA to help fund a child’s education.”