Many grandparents want to give their grandchildren a head start in life, and a common way to do so is to help by paying some (or all) of their school fees. This can, of course, simply be done by making a contribution at the time the fees are payable. However, it’s not unusual for grandparents to plan ahead by setting funds aside in a specific account. That is one option, but there might be a better one. Plan A Donna and Simon are a typical example. They decide to put $50,000 into a term deposit to help pay the school fees of their granddaughter Ellie when she starts secondary school in 10 years’ time. With an interest rate of 2.6% per annum (pa) and interest paid annually, their initial deposit will grow to $64,631 – a nice boost to Ellie’s future education. But is there a better way to use that $50,000? While it’s nice to have a specific account with its special status and easy to see growth, the important thing is the overall pool of money available to the family when the time comes to stump up the school fees. Plan B Ellie’s parents, Sara and Shane, are … Continue reading A different way to help the grandkids