What To Do If You Don’t Have Enough Savings?

It’s advisable to start planning when your child is young but that may not always be possible due to factors such as lack of awareness, too many family responsibilities or liabilities or limited income.

Says Charushilla: “Affluent families can provide their children with learning opportunities beyond the classroom. Tuition fees, coaching, textbooks, and other expenses put a lot of pressure on parents and may lead to inequitable access to opportunities.”

If you think you cannot afford to fund your child’s education, all is not lost. There are ways to cope with the situation. Here’s what you can do.

Aids And Scholarships

Many universities, both in India and abroad, offer student scholarships and aid. You should visit the websites of the institutes of your choice and find out the specific details.

Charushilla says there are many such options abroad. “While most universities may not admit to it, they are facing a domestic cliff—the number of citizens is on a decline—and they need international students to meet their annual yield. This has its pros, as a number of universities have substantial scholarship and financial aid packages to help more international students enrol.”

Though Charushilla had savings for her daughter Nandini’s education abroad, the family felt that the best way to prepare for this journey was by researching scholarship and financial aid options. Nandini received scholarships and financial aid worth over $30,000 from Marist College in New York.

Consider Working Part-Time

Pritam Sharma, 17, got admission to Bachelor of Business Administration (BBA) course at Odissa’s Sambalpur University in 2023. His father Vijay Kumar, a medical practitioner from Raurkela, Odisha, could only afford his first semester fees. Luckily for Pritam, he got to know that the university’s BBA course had an apprenticeship programme, which offers students a blend of academic rigour and practical experience. “This programme enabled me to self-finance my degree while also supporting my family with the help of the stipend,” says Pritam, whose three-year course costs Rs 45,000.

The story of Hyderabad-based Narendra Gurudwilash, 21, who is studying for a Bachelor of Commerce in Computer Application (BCOM) at Andhra Pradesh’s Acharya Nagarjuna University, is no different. He too opted for the apprenticeship programme. “With this programme, I was able to study, earn, and help my father (who is a contractor based in Hyderabad),” says Narendra, who hopes to fund the semester fees from his income. Both were in touch with TeamLease Edtech, an education and employability solution provider, for consultation.

Some universities also allow students to assist their supervisors by taking up paid positions of teaching or research associates. This also allows them to add experience to their resumes. “A number of universities offer assistantship to reduce the cost of education by way of stipends or fee waivers. An assistantship is basically an arrangement between the graduate student and the university whereby the department asks the student to assist in research and/or teaching along with continuing their own education,” says Sen.

“Besides teaching and research assistantships, students can also take up jobs such as quick service restaurant sales, tuition for high school students, babysitting, store merchandise arranger, social media assistant ect. These are part-time, but regular jobs and can help in covering expenses,” says Talukar.

Take An Education loan

Taking an education loan is always an option. They serve as a financial lifeline for students aspiring to pursue higher studies. While smaller loans may not necessitate collateral, larger amounts might involve the pledging of assets. Typically, taken in the name of the student, these loans can be repaid either by the student or their parents. The tenure for education loans varies, often allowing flexibility to align with the individual’s financial capacity. The average rate of interest in 2023 varied from 9-15 per cent. Individuals repaying education loans can avail of tax deductions under Section 80E of the Income-tax Act, 1961, under the old tax regime.

However, go for a loan if you plan to enrol in a course where income is assured soon after you finish it. Also, be careful about the amount you take. To fulfil the dream of giving a good education, parents may tend to overstep their budget or create a burden for their children that they may not necessarily be able to bear.

Charushilla says parents are quick to borrow for their children these days as many banks and non-banking financial companies (NBFCs) now offer up to 80-90 per cent of the course fee as loan. But problems arise when there is a job deficit after acquiring these expensive degrees because the loan has to be repaid. She says, “We’re setting our children up for a life of stress and financial bondage. We must exercise adequate counsel before selecting colleges and programmes.”

Adopt the step that is most suitable for your child and which you think your child can handle.