The pursuit of higher education is not just an intellectual endeavour; it is also a significant financial commitment, especially for those who opt to self-fund their studies. Meticulous financial planning is essential to navigate this financial maze efficiently and effectively. This article provides practical steps to assist with creating a financial plan for self-funding your higher education.
The benefit of studying part time
From a financial perspective the benefit of studying part time is that you can earn while you learn. This is a massive advantage over people that study full time. Yes, it will require sacrifice and yes it will be both easier and harder than you think right now but you can do it on your own steam. Through DaVinci Business School you can structure your learning to fit in with your lifestyle and your approach.
Step 1: Establish Your Financial Goals and Objectives The first step in any financial plan involves the clear delineation of your financial goals and objectives. These should include immediate objectives, such as tuition fees, books, and living expenses, as well as long-term goals, like emergency savings or starting a retirement fund. Your financial goals should be SMART – Specific, Measurable, Achievable, Relevant, and Time-bound.
Step 2: Understand Your Total Educational Expenses A critical step is to fully understand your total educational expenses. At other institutions, one should consider additional costs such as books, lab fees, and technology costs, and indirect costs like accommodation, transportation and personal expenses. However, with DaVinci Business School being completely remote, you will not need to travel to campus, live near campus, or purchase any additional textbooks. DaVinci Business School is unique in that its costs are quoted as a total cost and there is no additional requirements for books and other items. You will however need a laptop with a good internet connection.
Step 3: Assess Your Current Financial Status Firstly, you need to think about if you want to pay upfront or monthly. For upfront you are going to need a lump sum. If you have this as cash then that is great and if you do not have it as cash today then the question is how to get there. You may consider selling an asset or getting a loan. The first step is to list your assets and your liabilities and determine if you have a net positive net worth (assets – liabilities). If not, then you need to work on reducing your liabilities while saving towards assets. If you want to pay monthly, then you need to work out your total available monthly spend. This would be the difference between income and expenses. Consider that you will have to have a bit less discretionary spend if you study.
Step 4: Create a Budget Budgeting is a cornerstone of personal finance. Use your goals, educational expenses, and current financial status to develop a comprehensive budget. This budget should delineate your income and expenditure categories, track your spending, and ensure you have a surplus to contribute towards your financial goals. If your goal is to study, then you can put in place a clear understanding of how much you will need before you can start. You must also take into consideration that inflation increases the price of items annually. Education inflation can be quite high so budget for 5%-10% increase annually.
Step 5: Develop a Savings and Investment Plan A savings and investment plan is key to achieving your financial goals. This could involve setting up a dedicated savings account for your education or investing in low-risk investment products to grow your money over time. It's important to consult with a financial advisor to understand the best savings or investment options based on your risk appetite and time horizon. Make sure to discuss your educational ambitions with them and get a couple of opinions from different people before signing up for anything.
Step 6: Consider additional Part-Time Work or Bursaries If your savings and current income are insufficient to cover your educational costs, consider part-time work or applying for scholarships. Many institutions offer workstudy programs, and there are numerous bursaries available for different demographics and fields of study. You can find out more about bursaries from VELA Trust (www.velatrust.org)
Step 7: Student Loans and a Debt Management plan The major source of funding for many people is a student loan. What is important to plan when you decide on a student loan is to also have a debt management plan in place. This involves understanding the terms of your loan, planning for repayment, and incorporating the repayment into your post-graduation budget.
Step 8: Remember Emergencies Life is unpredictable, and financial emergencies can occur. Therefore, ensure your financial plan incorporates an emergency fund. This fund should ideally cover 3-6 months of living expenses. Also – you may want to consider insurance if you are taking out a loan and something happens to you. It is usually relatively inexpensive but can make a big difference to you if you get it right.
Step 9: Review and Adjust Your Financial Plan Regularly Finally, remember that financial planning is a dynamic process. Regularly review and adjust your financial plan based on changes in your income, expenses, or financial goals. This will ensure that your plan remains relevant and effective.
What if I still cannot afford it? After all this work you may find that you still cannot afford to study. This does not mean that all is lost. Ask your Business Developer to send you our guide to Asking your Boss to fund your education. Also consider that it is important to start somewhere. You may not be able to start with a degree, but you could potentially
Start with a shorter course like a higher certificate and ask about the number of credits that can be converted to a degree.
Find out about flexible scheduling where you take fewer modules per year to have a smaller instalment.
Do some short courses that can assist you with increasing your earning potential so that you can upsize to a degree.
Constructing a comprehensive financial plan is an integral part of self-funding your higher education. By following these steps, you can mitigate financial stress and concentrate more effectively on your academic success. Even it seems too expensive remember that you are increasing your earning potential over time – and your DaVinci Business School business developer will assist you to find a solution. Remember, the journey towards higher education is not merely a financial endeavour but also an investment in your future. Manage it wisely.
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