My kids are now at ages 5 and 7 now. It is a trying but fun age where they are very active, curious and full of energy. At the same time, besides the usual parenting issues I face, I also realise that I have to think more about investing for them as well. I previously just took their New Year and Birthday Ang Baos and invested those into their beneficiary accounts. But now that the older one is going to school (Primary 1), I am starting to think about their university education.

We all want the best for our children, but education is not getting cheaper. Even at the subsidised rates in Singapore, a typical university education can cost tens of thousands of dollars. My son is not exactly top of his class. Though we are only talking about Primary 1 here, it’s enough to make my wife very worried, and I may at some point need to consider the possibility that he may need to go overseas for his university studies if he can’t get a place here in the local universities.

Since they are not subsidised, overseas university fees are much more expensive. Even Australian universities, which are popular choices due to their proximity, would easily cost over a hundred thousand dollars, and this of course does not factor in inflation. I have never known universities to lower their school fees. If anything, it only steadily gets higher. So, I am under no illusion that one hundred thousand now in school fees may easily be two hundred thousand by the time my kids actually go university.

A regular savings plan allows me to invest money each month automatically into a designated fund of my choice within my children's beneficiary accounts. It remains liquid because the monies are not locked in at all. If at some point, for some reason there is a need for me to utilise that money, it can be immediately sold off. I also don't need to worry much about when to invest because the money is automatically deducted from my bank account each month at a fixed date.

I have selected an equity fund for this Regular Savings Plan (RSP) primarily because these are very long term investments (my kids are only 5 and 7 this year), and the process where money is invested regularly each month ensures that I will keep to a disciplined investment plan. The nature of RSP is that the dollar amount invested is fixed each month. Hence, when markets go higher, I buy fewer units, and if markets go lower, then I buy more. Over time, this plus the long time horizon involved actually translates to a lower average price and takes away a fair amount of the risk that is involved in investing into equities.

As I look at my kids, I can see why people have fewer children in Singapore these days. Costs are going up, and a lot of kid-related stuff are very expensive. But having a kid isn't only about dollars and cents; it's about matters of the heart as well. At the end of the day, we still love our children, no matter how hard or costly it is to bring them up, and we will want the best for them. Every parent thinks this way.


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