school age
An education fund is a dedicated savings or investment vehicle designed to help parents and guardians prepare for the future cost of their child’ s education. It creates a clear financial plan for one of the most significant investments a family will make, helping to cover expenses such as school fees, tertiary education, accommodation, textbooks, technology, and other related costs.
At 1Life’ s Truth About Money, we encourage parents to view education funding not simply as saving for school, but as an investment in generational wealth. Education remains one of the most powerful tools for creating opportunities, improving earning potential and building a stronger financial future that can benefit generations to come.
Education remains one of the most powerful tools for creating opportunities, improving earning potential … whether you are saving for private schooling, public schooling, tertiary education, or a combination of these.
• The time horizon, or how many years you have before the funds will be needed. This will influence the level of investment risk that may be appropriate.
• How much you can realistically contribute each month without compromising other financial priorities.
• Your risk tolerance and investment preferences.
• The expected impact of inflation on education costs. Education inflation has historically increased faster than general inflation, so it’ s a critical consideration when setting targets.
• The costs and fees associated with the product. Parents should pay close attention to administration fees, advice fees, platform fees and investment management fees, particularly on some older products marketed specifically as education funds. Even seemingly small annual fees can have a significant impact on long-term returns and the final amount available to fund a child’ s education.
• Whether the product is the most appropriate vehicle for your needs. Dedicated education funds can be an effective solution for many families, offering structure and a clear focus on a child’ s future education costs. However, depending on your family’ s circumstances, a general investment account may sometimes achieve the same objective while offering different levels of flexibility, access and cost. Obtaining professional financial advice can help you compare the available options and select a solution that aligns with your goals, budget and broader financial plan.
• Whether you may need flexibility to access funds if your circumstances change. Some education-focused products have specific features and restrictions, while other investment structures may offer greater flexibility. Understanding these differences upfront can help avoid any surprises later.
Having clarity on these factors will help determine the most appropriate savings or investment strategy for your family and ensure the plan remains sustainable over the long term.
What to consider
Before selecting an education fund, parents should consider:
• An emergency fund. Before committing to long-term education savings, it’ s important to have accessible savings equivalent to at least three months’ worth of essential living expenses. As parents, you naturally want to prioritise your children’ s future, but one of the best ways to protect that future is to ensure the household is financially resilient today. Without an emergency fund, unexpected events such as job loss, medical emergencies or major household expenses can force you to withdraw education savings early or take on debt.
• Your education goals, including
Common mistakes
One of the biggest mistakes is waiting too long to start. Many parents underestimate how quickly education costs add up and overestimate how much they will be able to save later.
Other common mistakes include:
• Not accounting for education inflation, which often increases faster than general inflation
• Saving without a specific goal or target amount in mind
• Using short-term savings vehicles for long-term education goals
• Stopping contributions entirely when financial pressures arise
• Failing to review and adjust the plan as family circumstances change
Our 2026 Back-to-School Survey highlighted that many South African families continue to face significant financial pressure at the start of each school year, with education expenses often competing with other household priorities. This reinforces the importance of planning early and building education savings into a family’ s long-term financial strategy. � www. babysandbeyond. co. za
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