‘Experience is a good school. But the fees are high.’ – Heinrich Heine

Today, like many parents across Nigeria, I took my kids to school to resume a new academic year. Many kids are changing ‘level’ o! 

I marveled that my kids no longer cry as I took them to their new classrooms, to meet the new teacher and new classmates. Same school, but some faces changed. These kids grow so fast, soon we will be talking university fees o!

As I got to their school, there were many parents trying to confirm payment of the fees, some trying to get books and others bring to get new uniforms, and the like. It was a beehive of activity early in the morning.

September is arguably a financially stressful month for many people with children. But how do you pay for your school fees?

Do you pay it from your August Salary if you are an employee? Is your August Salary able to cover the total cost of all your children’s fees? Or do you prefer to make contributions over time for your children’s school fees? As a business person with irregular income, which works better for you?

Have you ever used the popular ‘ajo’ or ‘esusu’? Or you use your usual savings account only you dip into it? Or perhaps you are considering a targeted savings account like Piggybank? A mutual fund too could be a good way to accumulate funds for school fees plus interest! What is even better? You can invest with the intention that the returns from that investment pays for the children’s school fees. Returns from money market instruments or rental property can help meet this need.

I have a client who uses the online targeted savings platform Piggybank.ng to save for her child’s school fees. As a businesswoman with irregular income, she realized that waiting for August sales to pay her child’s school fees was not prudent and resulted in embarrassing situations at the school, which could affect her child’s self-esteem. 

She is able to make full-year payment for her child by putting in an amount every month towards school fees. For example, if the school fees for the entire year is 300,000, she puts aside 30,000 every month for 10 months. The extra 2 months account for funds for books, uniforms and allows for tough months. So she puts together N360,000 per year plus interest accumulated on the account. With this account, there are penalties for withdrawing earlier than stipulated dates which acts as a deterrent for her. For some others, the penalties do not stop them dipping into the account.   

You see, it is not cast in stone that you must do this but what is most important is, she has made this tool work for her.  I emphasize this because the same tool might not work for you for other reasons That is the importance of knowing yourself and what works for you to achieve YOUR GOAL, not somebody’s goal. 

Again, this is why knowing your weakness and strength with money is important and then building discipline in your finances comes next. Need help? Click HERE for options of how we can work together. 

Tolu Dima-Okojie