Half a million reasonsBy Sam Hunt

Half a million reasons By Sam Hunt

sam hunt

It now costs more than $500,000[1] to privately educate your child. Overall education costs have jumped as much as 61 per cent over the past decade and show no signs of abating.

Private education is a goal for a lot of people and as advisers we are often hear new clients say, ‘we want to educate our children privately but not sure we can afford it’.

Financial Scholarships

As a parent with children at private school, I ‘encourage’ my girls to sit scholarship exams.  Whilst they haven’t cracked the jackpot yet, I see no harm in trying, no matter how much they complain…

So, if a financial scholarship is off the cards, “what are some practical options?” I hear you ask…

Firstly, we recommend that you have a clear understanding of your income, expenditure and the timeframe in which you have to plan.

We are not advocating setting a strict budget, as we have found that like diets, the majority fail. We are, however, advocating establishing a clear cashflow plan with separate accounts to capture all income and allocate funds for discretionary and fixed expenditure.

The system we recommend efficiently captures surplus income which can be allocated to debt, tax, lifestyle or investment and can identify cashflow issues ahead of time.

Figure 1: Cashflow Management Plan

Once you have a handle on your cashflow , here are some options to consider:

Pay fees from current income

After your analysis, you may be in a position to fund private school fees from your personal and/or passive income sources. Understanding your pre-school fee cashflow is critical to ensure you don’t go backwards during the ‘schooling years’.

Accelerate repayments, redraw from mortgage

Make accelerated re-payments into your mortgage prior to the private school years, then re-draw when fees commence.

An obvious issue with this strategy is that without careful cashflow planning you can potentially fall into a debt trap and start using your mortgage to fund other lifestyle expenditure.

Develop & Implement a Funding Plan

Engage a professional to help provide you with clarity around your goals and objectives and develop strategies to achieve them.

Most busy professionals don’t have the time or inclination to dedicate to properly manage their finances. It is important that they engage a professional early to help them achieve what is most important to them.

Fail to Plan, Plan to Fail - If a private school education is a goal for your children, start planning now! 

To discuss how WARR HUNT plans for school fees, contact us on 99350970 or /

[1] ASG 2017 Planning for Education Index