A few months before Kira, my second child, was born, we had to buy a new car. My husband is so tall that when he pushed his seat back, there wasn’t room for a kid in a car seat behind him. So bye-bye to the pre-kids sporty number and hello to a sensible family station wagon for four people and two prams. Likewise a friend had to shell out for a Kombi, because when his offspring became teenagers they had big toys like kite-boards and mountainbikes that couldn’t fit into a car for their holidays.
I bet all you prospective parents out there haven’t even considered the vehicular challenges awaiting you.
We have been hemorrhaging money this month and most of it has gone the way of our two young kids. Just off the top of my head, this is what they cost us last term: school fees (at a government primary school) – R11 400; Kira’s remedial lessons – R600; ballet tuition – R750; ballet exam fee – R520; swimming school – R900; music for Kira – R680; Gym Wizards for both – R1370; Tom’s rugby club – R350; surf club – R600. That comes to R17 170 and that’s only on the education and sporty side of their lives. There’s still Tom’s birthday party for 18 boys, which won’t give any change from R1 500 once the cake’s iced, plus R1 200 for the new wetsuit for his present. We’re now over R20 000 and they haven’t eaten, bought new school pants to replace the ones that tore sliding down the embankment, rented a video or bought birthday presents for any friends.
Not all of the above is essential and my kids are heavy on the extra-mural activities front, but your kids will be badgering you to do them too, and you’ll want them to be able to. Kira is already angling at horse riding lessons this holiday – ka-ching, ka-ching!
From the first hospital bill when they arrive puking and mewling, kids are expensive and the cost grows exponentially as they do. The first four or five years are the cheapest but expect a leap in your medical bills, especially for GP visits and snot-diminishing medicines. Education is, of course, the biggie. While schooling in this country is theoretically free, if you want them to be able to read and write it’s going to cost you. To have my two kids at a government primary school costs R45 500 a year. A quick whip around of the websites of the kind of high schools I’d consider for them, indicates that I’ll be paying between R18 000 and R22 000 a child a year. That’s for a government, former model-C high school, at current rates. Add seven per cent a year for inflation. For a private high school, you can triple those figures with the county’s top private schools charging upward of R85 000 a year. There are far cheaper options, but as cost diminishes so the teacher:learner ratio increases dramatically. And with the way government education is heading, you’ll want the financial power to shop around a bit.
Tertiary education is surely a dream for most parents, but the cost has increased hugely over the past 20 years. The average cost for a university education is from around R10 000 to R50 000 a year, depending on the institution and course taken. This is for tuition alone. Add around R20 000 for residence fees with food and books on top of that. So, if your precious munchkin was born in 2008 and goes to university in 2027, you will need in the region of R400 000 for tuition, or they will need a fairy godmother.
If you want to be assured of a reasonable education for your children, it’s essential to start saving now, and we are no longer talking university or college only. Many financial institutions have educational policies, such as Sanlam’s Stratus EduFocus (www.sanlam.co.za) for that very purpose. So speak to your financial adviser as soon as you’ve tapped the ash from your celebratory cigar. Another good option is the Fundisa Fund – a joint initiative between the government and the unit-trust industry, where government tops up your investment contributions. Check out www.asisa.org.za.
And finally, like John D Rockefeller, teach your children to value money from a young age. Once they start receiving pocket money, make them keep an account record, save at least 10 percent and donate 10 per cent to a charity of their choice. You never know – they may be able to contribute to their own education one day.