Investing for your child's higher education

Building a sufficient corpus for the higher education of their children is an important goal for many parents. They want to do the best when it comes to their children. To do so, what strategy should they follow? Dhirendra: Not much of a strategy will work here because it's a very complex thing. One is that the goal is far ahead in the future. Then you don't know how much you will need. The cost of higher education could vary vastly. Suppose a child is preparing for Engineering and gets into IIT to which he has been aspiring, the parents would have been saving accordingly and there would be sufficient capital. However, if he does not happen to get through IIT and decides to join some other Tier-2 college, the cost would be somewhat similar or could even be less. But if he or she aspires to get an engineering degree from a foreign university, the capital required could significantly balloon. Then the parents' accumulation may or may not be a significant part of the cost. Also, inflation in education costs has been far higher than economic inflation over the last 20-30 years. One reason for it could be the structu

This article was originally published on November 14, 2019.