If you have been looking to put your kids through private school in the coming years, you probably baulked at the massive fees of around $35,000 per year, per child to get them through successfully.
These sort of expenses can have a massive strain on the household budget moving forward, but with a little bit of foresight, there is a great way to help alleviate some of these pressures.
Given that you’re going to be investing in your children’s education in the future anyway, why not start early and invest in a small property investment to help fund the endeavour?
While not a common strategy, investing in an asset like property means that it grows over time, ultimately yielding you as much if not more than would be needed when the time comes to pay for school fees.
Over a 10 year timeframe, investing in a property worth around $500,000 will generate you around $300,000 in equity given it grows at a modest growth rate of around 5% per year.
By investing early enough, you have the power of compounding growth working for you, so that when it is time to front up for school fees, you have that equity to draw down upon through the loan facility or an offset account.
This can help alleviate some of the household pressures that you might face in your future household budget.
If you are looking to invest in property, make sure you’re aiming for areas that will generate some strong capital growth for you. By investing in property with good growth moving forward, you can start planning for the future, for yourself and for the kids and alleviate some of the pressure that we all face with growing education costs.