Why Teak is the Perfect Plan for Paying for College

Posted by Adam McGeehan on Feb 26, 2016 9:55:47 AM

For many American families, one of the first things that they think of when a child is born is about that child’s future, providing for it and giving it the best life possible. Today, a big part of that means that the parents are able to provide that child with a college education. 

Many adults go about saving for their children’s college education by purchasing government savings bonds (that’s what mine did). But let’s be honest, savings bonds are little more than glorified savings accounts. The returns aren’t that great, so why do people still have them as their first strategy for saving for important things like their child’s college education? Many of you reading this may be thinking that it is because savings bonds are so secure. And this is true. Savings bonds are incredibly secure, and to invest a child’s college fund in a more lucrative but less stable manner, such the stock market, can be a risky business.

But what if I told you that there was something that was more secure than stocks, and that would get you much better returns than the average savings bond? Well, although it may sound too good to be true, it is not. Teak is of course what I am talking about. This wonderful tree can be the perfect investment for something like a child’s college fund.

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High Return, Low Risk

Teak is an incredible tree, and investing in it can offer some incredible benefits to the investor. Teak is a very high-quality wood, and the price for this wood is ever increasing. In fact, over the past 30 years, the price of teak has increased on average 5.5% annually. In the past several years that number has gone up to a 7% annual increase in the price of teak. What this means is that teak can be an incredibly lucrative investment. 

Teak is also incredibly stable. At the ripe young age of 3 years old, the teak trees develop resistances to rot, fungus, termites and fire. Pretty much all of the things that would normally plague other trees, teak grows resistant to. This makes it an incredibly solid investment. And the fact that teak wood is highly sought after and has an established role in the manufacture of various high-end items, coupled with the fact that teak is currently being harvested at 8-12 times the rate of replanting, means that teak is likely to continue to increase in value as time goes on.

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Building Generational Wealth

One potential drawback of investing in teak is that it takes quite a while for the investment to mature. From planting to harvesting takes 25 years for the teak tree. This means that an investment in teak is one for the long term. While many might find this a drawback, for those who are making plans for big expenses in the future, such as a child’s college education, this can actually be seen as an advantage. When saving for a child’s college education, you want the money to be put into a long term investment, because it will be a long time before you need to utilize it. Well, this is exactly what teak is.

If you are lucky enough to be blessed with a new addition to your family, or are making plans to do so, then you may want to consider an investment in teak to secure funds to pay for college for your child.

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Adam McGeehan

Written by Adam McGeehan

Adam is a recent graduate of Allegheny College. There he majored in Economics with a minor in Spanish. He has always been interested in traveling abroad and is thrilled to have recently taken up residence in Managua, Nicaragua to work as an intern for ECI Development. He is excited to take in all of the culture of this wondrous nation.

Topics: Investing in Nicaragua