The Real Cost Of Your Children’s Education

As the old adage goes, nothing in life is certain other than death and taxes. Perhaps a third truism could be added on to this list – that raising children is expensive.

Nowhere else is the true financial impact of having children more obvious than in the cost of their education. According to the Australian Scholarships Group’s media release on the Planning for Education Index, which estimates future schooling costs for the years ahead, fees in the vicinity of $500,000 will be required to put just one child through private school, as compared with the still significant cost of between $50,000 and $70,000 for public schooling.

These figures include expenses such as uniforms, transportation to and from school, extracurricular activities, as well as tuition. The tuition price gap between private and public schools is huge, and Catholic schools often sit somewhere in the middle in terms of affordability. Any school education is a huge financial commitment for parents. So what can you do to ease this burden?

Choosing a school

When making the decision on where to send your children for their education, it is important that you consider what outcome you’re looking to achieve for them. Are you interested in academic outcomes only? Are your children particularly focused on the extracurricular activities such as sport or music? Is it important that they attend a school with other friends from the neighbourhood? These matters should all be factored into your decision-making process. It might be the case that a pubic school near you offers an outstanding sports program, and that school may be the best option than one with a stronger academic record, for example.

Ensuring affordability to avoid disruption

We all hope our children will settle into a school and make long-term friends along the way, and not have to weather any serious disruptions. If you have made the decision to send your children to a private school, like many of your other financial commitments, it’s important that consideration is given to your ability to meet the payment of the ongoing school fees for as long as your children are at that school. This includes a review not only based on your current circumstances, but also having regard to what would happen if your circumstances were to change for some unforeseen reason.

A good way to safeguard your child’s ability to remain at the same school were an extreme event occur is by arranging Income Protection insurance for sickness or injury and NobleOak Life insurance, which will pay out in the event of an unexpected death, which could otherwise make it difficult or perhaps even impossible for the ongoing school fees to be paid.

Look for scholarships and other programs

You should also bear in mind that many private schools offer scholarships or bursaries, which can discount the fees partially or in full. If you feel that your children are particularly gifted or otherwise academically advanced, you may wish to approach the potential school of your choice to explore whether this is available and which could help ensure that you can achieve the educational dreams for your children.

Plan ahead for the costs

You could think about setting up an education fund once you have made the decision to have children. If you can add to this fund regularly and then invest the funds appropriately once you have built up a nest egg, you could find it easier to meet the financial costs and provide your children with a quality education.

Education is undoubtedly expensive, whether you choose a public or a private school. You will need to prepare early and weigh up the best school for your children. Also, talk to a life insurer direct or through an adviser about protecting your income and protecting your family, and you will ensure that you have the best chance of funding your children’s education throughout their school years, which will set them up for the rest of their lives.

Please note that the information we provide is not advice but general information only.

Sources

2015, Australian Scholarships Group (ASG), Planning for Education Index media release, ASG, viewed 17 November 2015