Securing your child’s school fees
Smile and open your pocketbook because it’s back to school time again. Don’t give me that surprised look. You knew it was coming and the onus is on you to be prepared for the upcoming school term. Now is the time to get your act together and head off the mad dash that accompanies the back to school season. If you are smart, you will have budgeted for the myriad of back to school expenses, and your pressure is minimal. In fact, maybe the biggest stress you face is the depletion of your bank account. Never mind.
For those of you who have no idea what the concept of advance preparation entails, let me explain it to you. The big secret is after you pay school fees for a particular term, start putting away a few thousand dollars each month towards the next school term. Which of course, requires a reality check on your part. In your budget, you have to trim the fat. Do you love to eat out? Buy a calling card every day? Well, stop it. Cut back these types of unnecessary spending and put the money away for school-related expenses. Advance planning is the key to avoid the regular August/January headaches that many parents face.
But perhaps this advice is too late for you. You live your life, had your fun and are now staring school fees and book lists in the face, with a bewildered and frightened look. Just admit that you are scared and worried about where the money will come from to pay for little Kay-Ann to go to school. Stop panicking and let’s look at your options.
Education Loans
Consider borrowing from your friendly financial institution to cover upcoming school fees. Be sure that you have collateral or a guarantor before you talk about a loan. Commercial bank, credit unions and building societies offer loans to their customers to finance education. For example, Jamaica National Building Society (JNBS) offers two types of loans that can be used for education purposes. Joan, a customer service representative, states, “we have an Education Loan for persons with their name on a title. You have up to 10 years to pay at 16 percent interest and can borrow up to 85 percent of the value of your home. Another loan is the Term Share Account. This is for the person with a fixed deposit at JNBS. You get 75 percent of the fixed deposit. The rate of interest is 2 percent higher than what is being earned. Additionally, you have 3 months to 3 years to repay the loan.”
Note that while a loan can give you breathing room by having the payments spread out over time, remember that should you default, you risk losing your assets to the bank.
Home Equity Loans
Do you own a house, an apartment or a piece of land, with a registered title? If so, this is an excellent source of funds. You can unlock the value in the property to pay for school fees and back to school expenses. In fact, you could borrow enough for one full year or two years and ease the school fee pressure. However, you must pay back the loan. It shouldn’t have to be said, but some people tend to forget that pesky little detail after the cheque is cut. But just like with any loan, you will lose your property if you mess around with a bank’s money. So take the time to plan ahead, and use what you have to your best advantage.
Salary Advance
An option available to working individuals is the salary advance. Depending on your salary and the company’s policy, this is an option to manage school fees. And do it as soon as possible, because if you are part of a rush, you might have a long wait. Caution is needed though as when you get the loan, the repayment will be withdrawn from your salary. This means a reduction in your take home pay. Therefore, a re-working of your budget (you have one, right?) will be needed to account for the adjustment.
Family & Friends
Tap into your network of loved ones. They are sure to understand the pressures that parents face and might just be in a position to offer financial assistance. I would suggest that before you sing a song of woe, try of present yourself in a business like fashion. State exactly what you are going to spend the money on. Don’t be vague, in fact, a proforma statement of fees, books, shoes and other expenses would allow your position to be strong. Also, unless your relatives or friends specifically states that they are giving you a gift, state how you plan to pay them back. Whether your repayment plan is weekly, bi-weekly or monthly, returning the money loaned to you shows respect. You never know when you will be in a position to need money again. It is not wise to bite the hand that feeds you.
Your Child’s School
This is where fast action is required. If you have no alternative, head right now to your child’s guidance counsellor and speak to him or her about your financial position. Don’t wait till the day before the first day of school. And don’t tell me about, “me too proud to mek people know me business.” My answer is that you know what goes before the fall. Get off your duff and work out a payment plan that will allow your child to continue his or her education. At this stage of desperation, your feelings don’t count. If you are embarrassed to be out of pocket, so what? Get your child an education, and perhaps your grandchildren won’t have to suffer. Many guidance counsellors bemoan the fact that parents take shame and prevent their children from going to school. Even if your set-back is temporary until the money comes through from Western Union, talk to your guidance counsellor. Make sure your child is registered.
And hopefully, by now you are so tired of the scramble, that you will start preparing for January’s term immediately.
