Years ago an Australian Scholarships Group (ASG) fund was established for the kids. It seemed reasonably convincing at the time; that you’d put in a bunch of money each month and it would accrue interest and pay out when they went to uni, to pay for their expenses.
But after some years in it, I’m no longer totally convinced of its benefits, and I’ve stopped it and withdrawn the money. There are some issues with it, at least in my view:
- The return isn’t very good. You could put the money into a high interest account and get a better return. Which is what I’ve decided to do.
- It makes assumptions about what the kids will do, and what they’ll need for their education. While I could reasonable assume that my kids will work their way through high school, and then into university, some kids don’t. They might need specific education expenses sooner than uni. (School costs a fair whack too. As it happens the plan is my kids will be in a couple of good quality government schools, but even they don’t come cheap.)
- It (partially) locks up the money until they’re starting tertiary education, when me, the poor suffering paying parent, might be able to use it more effectively right now.
Certainly ASG has benefits. The primary one seems to be that it’s a pledge to put away a bit of money each month for future use in your kids’ education. It gets paid by “set and forget” direct-debit every month, which makes it easy to pile the money up. And it seems to work very well for a lot of people… but not me, I’ve decided.
This is not the only area of my finances I’ve been considering. With private health insurance premiums jumping yet again, I’m pondering (a) cutting my insurance back to the minimum to not incur the government tax surcharge (which is the only reason I joined) and/or (b) self-insuring (though it appears not many people do this in Australia for personal health insurance, so I don’t know how successful it would be.)