According to Statista Research Department the cumulative number of South African emigrants, by 2020, amounted to around 915 million people, showing that many South Africans leave in search of new opportunities and experiences.
Studying abroad provides a range of benefits for a young student. It allows access to specialised fields of study, highly-acclaimed accreditations and new experiences that last a lifetime.
However, the cost of funding such an endeavour is significant and requires careful financial planning well in advance. Unless your child can secure a scholarship or bursary abroad, the fees would likely have to be paid out of pocket.
If your child has dreams of studying abroad and you aren't sure how to make them happen, Erik Olwagen, who is the Head of Distribution at Standard Bank International Personal Banking for Africa advises parents that this is where to start.
What should you consider?
If time is still on your side, then this might be the best time to consider different investment options to help you save and grow your money.
Olwagen advises that parents speak to a financial advisor about different methods of investing and the risk profiles of those investments, depending on your unique circumstances.
If your child knows exactly which country or continent they'd like to attend school, you can also discuss putting money into an off-shore account of your chosen jurisdiction, based on your appetite for risk.
If however, time is of the essence, it is, therefore, advisable to consult an advisor to specifically address the objective and to map out an investment plan to achieve that goal.
You can ask your advisor about:
- Fixed-term deposits and notice accounts, which provide elevated interest rates and liquidity, making them more appropriate for short-term needs.
- More structured investments like structured deposits and structured notes which vary between one- and six-year terms.
- Unit trusts for additional flexibility.
Also read: 7 tips to stay safe while studying abroad
What costs should I consider?
To understand how much you need to save, you not only need to look at the cost of tuition, you will also need to estimate and take into account the costs involved in acquiring:
- International travel
- Visa fees
- Cost of living: travel, food, toiletries
- Textbooks and other educational material
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