On the back of a year plagued with business uncertainty and financial stress, we’re more aware than ever of the need to be as prepared as possible for what 2021 might throw at us. With Christmas over, it’s time to turn our attention to the next big financial outlay most parents will be grappling with: Education.
School-related expenses compromise a sizable chunk of family finances and often increase from year to year.
Research from leading education payment provider, Edstart, found that parents of children attending non-government schools are forking out an average of 35% of their annual income to cover the cost of school fees, which is greater than the financial burden that a mortgage imposes on the average Australian family’s net income.
While school fees themselves may initially sound manageable, they don’t include the many other education-related costs such as school excursions, private tutoring, devices, uniforms, after-school care, and extracurricular activities.
Before you start panicking, here’s how you can prepare for these foreseeable financial hurdles.
5 steps to managing school fees and education costs
1. Calculate the costs
Do your homework and speak directly not only to your child’s school but also to parents at the school with older children to get a realistic picture of everything you’ll need. Use this information to make a list of all education-related expenses for the next six to twelve months.
For items that fluctuate in price (eg. school supplies, devices, shoes) do some quick research online to determine how much they’re likely to cost. Ensure your sums are based on full-cost items so that you’re allowing yourself some wiggle room and don’t forget postage costs for online purchases too.
2. Make a Budget
The start of the year is the perfect time to reassess your financial position and roughly plan for the year ahead to determine whether your income is sufficient to cover your spending and allow you to work towards any additional family goals, whether they be holidays, renovations or big-ticket purchases.
You can use the MoneySmart budget planner to help you break down and calculate all of your costs and expenses.
3. Buy Second-hand
Before you rush to buy new uniforms and textbooks, investigate whether items (especially those that kids are likely to grow out of before they have time to wear them out) can be purchased elsewhere. Online pre-loved hubs like The Uniform Swap Shop, The Uniform Exchange, The Sustainable School Shop and Student VIP all offer cheaper and more sustainable solutions to buying new uniforms and textbooks.
4. Suss the Sales
Make a habit of keeping your eye out for when the items on your purchases list go on sale so you don’t get stung paying full-price if you leave your shopping to the last minute. Make an extra effort to pay attention to sales and catalogs, because it pays to plan ahead and you’ll thank yourself later.
5. Embrace a Payment Plan
Lump-sum payments are often due at the least inconvenient times! None of us want to have to compromise on the education we’re able to offer our children, nor do we want to spend all our time stressing about school fees. You can make paying school fees and covering education costs a smooth and stress-free process using a payment plan from a provider like Edstart.
Instead of having to fork out large upfront payments at the start of each term or semester, choosing a payment plan allows you the flexibility of making smaller weekly, fortnightly or monthly payments to help reduce the financial anxiety of large expenses arriving at inopportune times.
Edstart payment plans can be used not only for school fees but also for other education-related expenses. The plans are adaptable to your financial needs and enable you to choose between a 12-month interest-free plan or an extended loan option so that you can give your child the best available education without putting undue stress on your family.
Covering your child’s education costs is easier and more manageable through Edstart’s flexible payment plans, and for a limited time, if you sign up to Edstart using the code MS2021, you’ll receive a $50 cashback once Edstart has paid your Term 1 school fees of $2,500 or more.
If you’ve worked through these steps then you’re already ahead of the game and should be well-prepped for the schooling costs you are likely to face this year. Still have specific questions about school fees, budgeting, or other concerns? Don’t forget you can always turn to our supportive Mums of the Shire Facebook Group for more advice.