Saving for Child’s Education – Is it enough?

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In my recent workshop in Gurgaon, one of the topics that came up for discussion was “child’s education”.

One of the participants, let’s call him Ashok, mentioned that he pays Rs. 25,000 a month as fee of the school where her daughter studies.

It ensued a debate on how education expenses have risen dramatically over the past 10 to 15 years.

Ashok himself incurred only about Rs. 1 lac to complete his engineering – 20 years ago though.

Yet another participant mentioned that he spent just about Rs. 2 lacs as fee for his engineering and MBA.

I couldn’t resist mentioning that my own MBA – all tuition, lodging, travel and fun expenses included was completed in less than Rs. 1.5 lacs.

In fact, my entire year school expenses including fee in Class 10 was Rs. 10,000 only. This is a far cry from the fee of Rs.25,000 a month that Ashok pays for his daughter.

Of course in all these cases, the people went to Government funded and subsidised institutions, which charged only a nominal fee.

Times have changed though. The government institution doesn’t cut it any more.

As a parent, the one thing that you want to prepare your child for is to be ready for life in the best way possible. You want to equip her with the necessary skills and knowledge. You want the child to have an exposure that enables her do her best in life. You want her to stand on her own feet.

There’s a new breed of educational institutions (Schools, Colleges, Universities) that promise the fulfilment of these conditions.

You want the best for your child. Period.

However, what does it mean to you in terms of money? How much would you need to invest for your child’s education?

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