Financial Plan for Teenage Children

Dear Mr Tan,

1) My son is 21 yrs old. In year 2009, he will go to university. I plan to put aside of $30,000 for him to earn as much interest as possible. What should I do? Buy investment fund, endowment or bank FD?

2) My daughter is 17 yrs old. She will go to university in 2009. I also wish to set aside $30000 for her. What should I do?

3) I want to start saving habit for them now. I can either pay monthly for them for few years and next time they continue on their own. Or I can put now additional $10.000 for investment or saving. After a few yrs they can continue to pay.

Can you advise me what to do?

TBC

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Dear TBC

For short term savings, you can choose the following:

- fixed deposit from a bank (earns about 3% per annum, but locked in for the term)
- flexi-cash from Income (earns about 2.5% to 3% per annum, changes with money market, can be withdrawn without penalty).

My wife recently had $50,000 of fixed deposit matured. She placed it in the flexi-cash from NTUC Income. As this is flexible, she may re-invest in an investment fund at a later date, when the market corrects downwards.

For long term savings for your child, I recommend our Ideal plan.

Look at the FAQs:
FlexiCash
Ideal Plan

I will arrnge for our product specialist to call and advise you.

Tan Kin Lian