We’ve used information you’ve provided, combined with assumptions made by HSBC, to illustrate whether funds you have set aside and/or are prepared to set aside for your child’s education are sufficient to achieve the cost for the expected length of their education. The above illustration is presented on an estimated value basis. Figures shown are indicative only - they're not guaranteed and are not maximum or minimum amounts.
There is a chance that the investments you have set aside may be subject to adverse market conditions and you may receive a potentially negative return on investment. In the worst case scenario, you may lose your entire investments.
Our key assumptions
Growth rate
The initial results are based on an assumed growth rate associated with the risk level you selected.
Investments with greater risk usually have a higher potential for gains or losses. Whereas less risky investments usually offer more stability and a lower return.
Risk levels explained
No risk
You generally do not want to take any investment risk, since you cannot accept any investment loss. Financial products with an investment element are not suitable for you. Products that are potentially suitable are likely to produce returns based on prevailing interest rates which may or may not keep pace with inflation.
Very low
You are generally comfortable taking minimal risks to achieve a minimal level of return potential on your investment. Capital values of products that are potentially suitable for you can fluctuate and may fall below your original investment. In normal market conditions, fluctuation is expected to be minimal (although this is not guaranteed), and you are comfortable with this level of fluctuation. Investment products with a risk rating of 1 are likely to be suitable for you.
Low
You are generally comfortable taking a low level of risk to achieve a low level of return potential on your investment. Capital values of products that are potentially suitable for you can fluctuate and may fall below your original investment. In normal market conditions, fluctuation is expected to be low (although this is not guaranteed), and you are comfortable with this level of fluctuation. Investment products with a risk rating of 2 or below are likely to be suitable for you.
Balanced
You are generally comfortable taking a moderate level of risk to achieve a moderate level of return potential on your investment. Capital values can fluctuate and may fall below your original investment. Fluctuation is expected to be higher than products that are suitable for investors in lower risk tolerance categories, but not as much as for higher risk tolerance categories. Investment products with a risk rating of 3 or below are likely to be suitable for you.
High
You are generally comfortable taking a high level of risk to achieve a high level of return potential on your investment. Capital values can fluctuate significantly and may fall substantially below your original investment. You understand the risk/reward equation, and are comfortable with this level of fluctuation. Investment products with a risk rating of 4 or below are likely to be suitable for you.
Very high
You are generally comfortable with a maximised level of risk, to maximise your return potential on investment. Capital values can fluctuate widely and may fall substantially below your original investment. You understand the risk/reward equation, and are comfortable with this level of fluctuation. Investment products with a risk rating of 5 or below are likely to be suitable for you.
Inflation rate
Due to the rising cost of living, we project the figures based on an inflation rate of 1.65% when calculating your desired goal.
Your regular contributions
We have assumed that any regular savings or investments will stay in place over the contribution period, regardless of inflation. For example, if you start off at $1,000 per month, you will continue adding $1,000 per month for each year that contributions are made.
Figures shown in the graph/table
To illustrate the uncertainty of returns, we show a range of potential outcomes for the risk level you selected. However this isn’t guaranteed, and the value of the investments can be higher or lower than the ranges illustrated. Negative returns are possible and the entire investment could be lost.
Please note that all the returns shown in the table are future values, rounded down to 3 significant figures.
Making adjustments
If either the amount contributed at the start or the monthly contribution to the retirement fund is changed, we assume that the changes occur immediately.
The value of the education fund is adjusted to take into account any changes made. The return is then calculated based on the new value of the education fund.
If the risk profile is changed, the calculator will adjust the growth rate to that associated with the new risk profile.
