Every parent wants to send their child to college. However, making this dream a reality is not without a few struggles. With the not-so-recent fiasco with educational plans with pre-need firms, most parents have distrust with big financial companies for their child’s education. Saving seems to be the most viable and responsible choice, but banks offer very little interest, making it harder for parents to get more out of their hard earned money.

Let’s look at the numbers: the annual tuition in top universities in the country today costs an average of P80,000. If you’re parents of a newborn, you have 18-19 years before your little bundle of joy enters college. Now, consider the additional two years in high school by the newly implemented K-12 system. Now take also into consideration a let’s say, conservative 10% hike in tuition and compound it annually, the cost of a two-semester course will be P444,793.39 – and that’s just one year in college 18 years from now.

With tuition and other fees skyrocketing, what do you do to make sure your child finishes his or her degree?

The answer? Get a house.

Okay, so you’re probably thinking, “But we already have a house.” Yes, you already own a house but, read carefully: your first home is a liability; your second one is the real asset. Your first home subtracts from your income by utility bills, taxes, insurance, maintenance, renovation, and so on. And if you’re newly home owners, you’re still probably paying off your mortgage from the bank.

But we’re not saying you should sell your house in order to afford your kid’s education. Rather, invest your money in another property. Real estate is popular among Filipinos because it’s arguably the simplest way to preserve one’s investment, with capital appreciation and leasing opportunities.

“But what do I do with another house?” you ask? Simple: tie up your child’s college fund to your new investment.

According to an article by the Inquirer, land and condominium prices appreciate from five to eight percent annually. If you sell your second house after a few years, you can get almost double what you initially paid for. Of course, the value is in delayed gratification. In the meantime, you can use this property as a vacation house or as a place where relatives visiting from abroad can stay. You have to remind yourself that through this approach, you still have the same liabilities as your primary residence, which include paying bills, taxes, insurance, and all your other usual commitments. That’s more money coming out, with little to none coming in – at least nothing tangible.

Another option is to rent your second home. Not only will this bring in additional income for you, but you can also use the profits to build a college fund for your child. This way, you can earn money while your property increases in value. How’s that for a great return on investment?

Sending your children to school doesn’t have to rob you of sleep or drain your savings. Through smart investments and early preparation, you can be sure that your child gets the future you’re working hard to build.

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