The Ultimate College Fund Savings Guide for Filipino Millennial Parents (2025)

You know where I think most parents fail? THEY DID NOT PREPARE.

When that happens, kids are forced to step up and provide for themselves—through scholarships, part-time jobs, or relying on relatives. Some even drop out of school because tuition is simply unaffordable.

Many parents think they need a huge amount of money to start saving for college. But starting small and being consistent is far more effective than waiting for “the perfect time.”

Why? Because inflation doesn’t wait for you.

That means today’s tuition of ₱50,000 could double in just 8 years—without warning.

You can’t stop inflation. You can’t control school fees.

But you CAN control how early you start preparing. Your best solution? Securing your child’s education plan early, while they’re still young. As in crawling in their diapers young!

Start building their educational fund before they can even call you ‘Mama’ or ‘Papa’.

In this post, I’ll help you build an education fund that works for your family, no matter your financial situation.

The good news? You don’t need to be rich to start. You just need the right plan.

I’ve divided the options into 4 tiers according to household income.

Now, let’s explore which education fund strategy fits YOU best. 👇

Tier 1 is about building an education fund with small consistent savings.

This is like building a sturdy, immovable foundation for your home. The materials don’t need to be glamorous, it just needs to be functional. And being functional focuses on two things—stability and accessibility.

If you belong to Tier 1, your goal is to create a financial habit and establish a foundation for long-term saving, even with a limited budget.

How? You do this by starting with small, consistent savings and putting them in low-risk vehicles such as:

Let’s say you earn good income. Your basic needs (food, shelter, clothing, utilities) are taken care of. A few savings here and there.

Life feels stable—until one day, you need urgent surgery or face a critical illness.

💰 Will your savings be enough to cover both medical bills and tuition fees?

💼 Can your family manage financially if you’re unable to work for months?

🎓 Will your child’s education suffer if your resources are drained by unexpected expenses?

This is where insurance+investment plans come in.

A long-term InsuraVest policy is like a safety net that also grows your money. It provides coverage in case you face disabilities, accidents, and hospitalization. But when those don’t happen (thank God), your investment money still multiplies with compounding interest.

InsuraVest plans can act as both a financial shield and an education fund, helping you protect your loved ones while still growing your wealth. Because your policy is not just for emergencies. It can also fund your dreams, like providing the best education for your child.

A Time Deposit is like a locked savings account that earns higher interest because you agree not to withdraw your money for a set period (e.g., 1 to 5 years). The longer you keep your money in, the higher the interest rate you earn.

Example: CIMB has a time deposit account called MaxSave that gives out 6% p.a. interest rate for a holding period of 12-24 months.

If you deposit ₱100,000, in one year you’d receive:

• ₱107,000 (Gross Amount) – Before tax.
• ₱105,600 (Net Amount) – After 20% withholding tax on the interest earned.

Why are time deposits suitable for Tier 2 families:

Here’s a comparison between time deposit rates of traditional and digital banks:

We usually call government bonds as retail treasury bonds (RTBs). Instead of keeping your money in a regular savings account, you "loan" it to the government, and they pay you back with interest over time.

Example: Landbank of the Philippines issued RTB-30 last February 2024. A 5-year term bond that pays an annual fixed interest rate of 6.25% with a minimum capital of Php5,000.

Let’s say you invested ₱50,000. In the next 5 years, you will earn ₱3,125 every year in interest. And by the end of the 5th year, you get your ₱50,000 back.

Why are RTBs good for Tier 2 families:

RTBs are perfect for families who want guaranteed earnings while keeping their money secure.

A Unit Investment Trust Fund (UITF) is like a community piggy bank where several people put their money together to invest in bigger opportunities. Why manage your own investments if you can let a professional fund manager do it for you?

Example: Imagine you and 100 friends each chip in ₱1,000. That gives you ₱100,000, which a fund manager can use to invest in high-quality stocks or bonds that would have been too expensive to buy individually. When those investments grow, so does your share of the fund!

Why UITFs are great for beginners:

An endowment plan is where you save up money for a limited time, in exchange for guaranteed payouts for the rest of your life.

Think of it as "forced savings with benefits"—you save for 10 years, and in return, you get guaranteed yearly payouts for life plus insurance coverage for added financial security.

Example: Prulifetime Income is a 5- or 10-year plan that pays out 5% of your insurance coverage every year until 100 years old. So think of it as a future yearly allowance for your kid, and also your regular pension (to add to your SSS/GSIS benefits) during your retirement years.

Oh, and proceeds are tax-free by the way!

Why are 10-year endowment plans perfect for education funds?

Rather than whole-life or 10- to 20-year plans, Tier 3 families have the resources to allocate higher premiums with 5-year plans. Think of it like a big purchase that needs an installment basis.

Example: A car loan

You pay Php 30,000 for the next 5 years, right? And then the car is yours, fully paid. End of payment. But after 5 years, your car depreciates in value.

Let’s say you did the same—Php 30,000 for the next 5 years—but for your limited-pay InsuraVest policy this time. After 5 years, your payment ends but your investment continues to grow. Your funds appreciate in value because of compounding interest. Plus, you get insurance coverage for life (even if you only paid for 5 years).

If 10 years of paying for an endowment plan sounds like a looooong commitment for you, you can shorten it to half—only if you have the capacity to pay much higher.

Going back to the car loan example, where you pay Php 30,000 for 5 years and you’re done.

In a 5-year endowment plan, you pay Php 30,000 for years, you’re done paying, AND you start receiving payouts. For life.

Too good to be true? Well, that’s why this has a higher price value. Because you are leveraging on both time and money at the guarantee of earning passive income for life.

Exchange-traded funds are like a basket of investments from different companies off-shore. It could be a mix of tech (e.g. Apple, Google), manufacturing (e.g. Tesla), and all sorts of companies.

Instead of putting all your money in the Filipino companies, you spread it out worldwide, so you’re not relying on just one economy.

It’s like planting apple trees in the U.S. vs. planting a mango tree in your backyard. The apple tree grows faster and will probably sell for more because U.S. has one of the strongest economies in the world.

Compare that to your mango tree at home—it grows, yes, but oh so slowly.

We may not control the economy where we live. But we control where we invest our money. That’s why offshore investments help your education fund grow more than just saving locally.

However, this one needs a bit more research—especially when choosing your brokers. With a bit of due diligence, you can start your off-shore ETF wherever you are in the world.

In other words, these are your one-time pay InsuraVest policy. You only need to pay once, and then you park it there.

Let it sit. Forget about it. Focus on your passions in life.

After a few years, when you least expect it, your one-time deposit has now grown so much. More funds for retirement.

But this one-time payment could weigh a ton, especially for those in Tiers 1 and 2. It could range from Php 500,000 to Php 2,000,000—even more!

Example: PruMillionaire starts at Php 1,000,000. Leave it there and let it grow while getting life insurance coverage until 100 years old.

If you have funds sitting coldly in your bank that you don’t need anytime soon, you can park it here.

Imagine this—your son/daughter tells you it’s enrollment time and he/she needs Php 70,000 to start the semester.

Would you source that out from your salary? What about your monthly living expenses, such as electricity, groceries, and gas?

How about this instead—what if other people pay that Php 70,000 tuition fee for you? Instead of working extra hours to save for tuition, your tenant pays you every month—just like a salary.

To put it straight—your tenants pay for your child’s education.

Mind you, buying properties isn’t cheap. That’s why you should start now if you want a different income stream providing for your child’s education.

When your son/daughter graduates, you still own the property! You can keep renting it out for extra income or sell it at a higher price.

Instead of just eating at Jollibee, what if you own part of Jollibee and earn when it grows?

Stocks let you become part-owner of big companies (e.g., SM, Ayala, BDO, Jollibee). When these companies make more money, your investment grows too—helping you fund tuition.

If you want more control over where your money goes, the same is true for direct investments. Like franchises for example. Buy a small food cart or online store that generates income for tuition.

Stocks and direct investments are like planting seeds in fast-growing soil—they can grow faster than savings accounts, but you need to nurture them properly.