Parents with a child who is starting Grade One at a Private School this year will have to budget over a million rand to put that child through their entire schooling and university career.
As an example, if your child is starting primary school in 2012, you will have to budget:
- An estimated R267 000 for their private primary school education, from Grade R to Grade 7; and
- About R540 000 for five years of high school, totaling R807 000. The corresponding amount for a government school is estimated at just over R300 000.
Preferably, parents have to start an investment strategy as soon as possible after the birth of the child, to keep up with the spiraling effect of inflation. “For every R10 000 paid for education in 2002, approximately R20 000 will have been paid in 2012. The average increase in the cost of education was 7.27 % a year over the past decade. This effectively doubles the amount needed for schooling every 10 years.” This far exceeds the corresponding average rate of inflation of 5.04% over the same period.
A tertiary education (including accommodation and books) for a child born in 1994 will cost R197525, compared with an estimated R537 194 for a child born in 2006 and starting school in 2012.
You can achieve your hopes for your children by:
- Investing an adequate amount and starting as soon as possible. The earlier you start investing, the less you need to invest
- Invest in a cost-efficient manner. In other words, take the costs of the investment into account
- Take account the unforeseen events. You need to ask yourself how you would provide for the education of you children if you became severely ill, disabled or died. In other words, make sure you are adequately covered by life insurance
Remember: It is never too late to invest in a good quality education for your children. However, the earlier you start, the better your chances of securing them a bright future.