Money Tips for Parents Saving For Their Children's Education
#3. Use a Tax-Free Savings Account
Through investing your money into a tax free savings account, the savings will grow tax-free and the money can be easily withdrawn in the future to help finance your child’s education, without having to pay taxes.
#4. Set up a trust
It is important to set up the trust with a written agreement, with terms and conditions. There are also tax penalty to think about, depending on how the trust is funded.
#5.Pay out corporate dividends
If you are included in a family business, you could build up savings in your corporate account and pay them out in the form of a corporate dividend, at a later stage for your child’s education. The benefit of this is that the dividends will be taxed in the hands of your child, who may have a low income.
