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Can you afford Private School education for your children?

Article By Brett Moxey | | Financial Planning

Will your kids go to private school is part of the equation for raising a family. However, this is a significant cost on the household income and therefore planning for this expense is worthwhile.

How much money you need will depend on which school and whether this is for both primary and secondary or different for each stage. For example, if you send two kids to a private school which costs an average of $15,000 a year plus $2,000 for extra’s such as uniforms, trips and sporting clinics etc. per child, by the time they both finish 12 years of schooling you will have spent $408,000 on school fees.

Once you run the figures, Public schools can start looking very attractive. It’s about balancing the cost with your other goals in life. Depending on your child, there may be more beneficial things you want to save for to give them a great start in life. I.e. first car, deposit for first home OR other types of education. At the end of the day, it comes down to your goals and the fact all children are different I.e. Some children may thrive in a certain school because of the specialities offered.

However, with a bit of planning you can save up enough to have the option when the time arrives, OR with financial planning advice you may workout a way to afford this without deteriorating your own financial future.

Some of the options used to save for education costs are;

Before putting your money into any of the above options you need to consider your other financial obligations. For example, paying off your mortgage or other debts first, may be more effective as a strategy.

Access to funds is an important consideration when saving for your child’s education. What criteria needs to be met before you can access your funds? What happens if your circumstances change, and you can no longer contribute. Are there any costs with this or will it be difficult to withdraw your money if your goals change?

Also before deciding on an option, you should compare Product fees, features and benefits, and tax.

In summary if Private Schooling is your goal it can be expensive and the earlier you start planning the better. The best thing to do is to seek financial advice and workout the best strategies for you in conjunction with your own financial future.

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