How much your child’s education will cost
In most circumstances, when parents start saving for the education of their children, they are usually thinking about university fees. In South Africa, however, a decent education usually comes at an even higher cost, with many parents opting to send their children to so-called model-c schools, or to private schools.
The problem is that the cost of education rises well above inflation and the average salary increase, as the graph below illustrates:
The graph shows that for every R100 you spent on general consumer goods in 1990, you now have to spend at least R446. This translates to an increase of about 7% p.a.
For every R100 you spent on education in 1990, you now have to fork out a staggering R1 362, which equates to almost 13% p.a.
If your salary increases in line with inflation (which is a reasonable assumption) you would be R916 short of the R1 362 you would need to pay.
The only way to keep ahead of the curve is to invest in growth assets such as shares or listed property which, as the graph demonstrates, provides returns greater than inflation.
What you can expect to spend on your child’s education
The following table will provide you with some idea of what your child’s education could cost you. The amounts depend on how old the child is, currently.
As you can see, the costs of secondary and tertiary education rise significantly for a seven year old – this is due to the effect of inflation on education costs.
Age of kid today |
Private | Public | ||||
| Primary | Secondary | Tertiary | Primary | Secondary | Tertiary | |
7 |
R783,324 |
R1,024,826 |
R718,821 |
R224,336 |
R293,591 |
R718,821 |
14 |
n/a | R560,615.37 |
R393,220.14 |
n/a | R160,604.50 |
R393,220.14 |
19 |
n/a | n/a | R255,566.11 |
n/a | n/a | R255,566.11 |
The bottom line is that the cost of putting a seven year old through an entire scholarly career – that’s primary school, high school and university - is R2.5m through a private curriculum and R1.2m through the public education system.