Lifestyle

Financial Implications of Private School

The Cost of Private School

Our little one turned two this weekend. TWO. I was an emotional mess, a cross between very happy that I had a sweet, healthy, happy two year old and very sad that my baby is no longer a baby. I kept envisioning him heading off to university which would results in pools of tears welling up in my eyes. Drama queen? Just a tad.

Financial Implications of Private School

The kid’s birthday celebrations were low key, not too much different than any other Saturday. He wore a birthday pin and we let him choose what to eat all day: bagels for breakfast, pasta for dinner, and berry cheesecake for dessert. We’d also break out into song, singing “Happy Birthday” at the top of our lungs, on demand; we sounded like a broken record because he requested we sing it over and over again. That made him feel special, differentiating his birthday from any other day. We gifted him with a tricycle we purchased used a few weeks ago; he squealed with delight at the sight of the trike.

Private School Recommended for my Toddler

Gardening was also on the birthday itinerary and we stopped by the local nursery to pick up some seeds and tools. While I was deciding between types of tomato seedlings, a lady started chatting with Daniel about the advantages of private school. I caught the tail end of the conversation, the former teacher recommended we put our two year old in private pre-school and stated that if we wanted our child to be brilliant, he should attend elite private school such as Upper Canada College or Hagerval College, where she attended. She didn’t “believe in the public school system” and insinuated that private school was necessary for a proper education. “It’s $30,000 [annually] for a good education” she said.

Okay, so everyone is entitled to their own opinion, but lady, are you friggin kidding me?! What annoyed me was that the lady implied enrolling in private school was the best thing parent could do for the child without considering that the average family in Toronto can’t possibly afford to do so. $30K isn’t chump change.

I’m not going to debate the merits of private school or the brilliance of private-school educated children; I just want to take a look at the financial implications of having to pay for private school.

Cost of Private School

Here is a list of private schools in Toronto and their respective annual tuition costs as of May 2014. Keep in mind, these costs do not include the admission fee, cost of uniforms, field trips, books or supplies.

[table]School, Tuition
St. Clement’s School, $26 675
Toronto French School, $29 300*
Upper Canada College, $32 950*
Royal St. George’s College, $29 100
Hagerval College, $28 600
The Bishop Strachan School, $29 470
Crescent School, $29 950
Average, $29 435[/table]
* This fee is specific to high school students only

The Cost to the Average Family

According to the census taken in 2011, the average gross income for families with children (under 18 years of age) was $114,000. Less income tax, the take home pay is closer to $80K. Assuming the average household has two kids, tuition alone will eat up more than 70% of the budget. Is that really financially feasible?

The Cost to Our Family

Our current gross income totals approximately $150,000 (give or take 10%- we’re not ready to reveal such information). For simplicity sake and to get nice round numbers, let’s assume our annual take home is $100,000. We want two kids. To put two kids in private school, it would cost us approximately $58,870 a year in tuition costs alone. This would result in the lionshare of our budget allocated towards tuition, leaving approximately 40% to cover the cost of living. Cutting all unnecessary expenses and living off the bare minimum (tithe, mortgage, groceries, transportation expenditures, internet and phone bills), we could make due with living on 40% of our net income, but that would leave us with little to no savings whatsoever. For us, the costs of private school would be a burden. It’s not only foregoing certain luxuries, like travel, but after paying for tuition, we would be scrapping by.

Let’s also assume that we also pay for post secondary education further down the road- I mean, if we’re paying for private school, why wouldn’t we also pay for college/university? If that were the case, we wouldn’t be clear of this $60K/year cost until we’re well into our fifties. That would give us only ten to fifteen years to focus on retirement savings with the intent of retiring at 65 years old. No thank you.

Putting my existing child and hypothetical one in one of the aforementioned private schools would most likely mean they’ll receive the best education offered in Canada, but would it be the best thing I can offer? Just getting by financially would result in additional stress and anxiety, possibly taking on additional work to supplement income and thereby taking time away from my children, foregoing my own financial independence, and the ability to help out my children financially in the future if I so desire.

The Last Word

I’m sure private schools provide an excellent quality of education, but even with that in consideration, are private schools best for children and their families when you account for the costs? For people who can truly afford it and want their children in private school, by all means, go for it, but for the average household, it would mean working to pay for school and thereby jeopardizing savings and a standard of living.

The lady at the gardening center was shortsighted for thinking that a good education at a cost of $30k a year is the best thing that parents can provide for their children. The fact of the matter is private school has huge financial implications on an average family. The costs of tuition can severely handicap financial stability. Maybe it’ll produce brilliant children, but be wary of the consequences.

My little one will continue to attend his non-privatized daycare and, in a few years, attend a public school. I guess I’ll risk his brilliance.

Are private school tuition costs worth it at the expense of future financial stability? 

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  • save. spend. splurge. May 29, 2014 at 9:14 PM

    1. Those prices are ridonkulus (so ridiculous I had to misspell that word).

    2. I always keep in mind that those kids who went to those fancy private schools, ended up at the same school I went to, in the same classes I attended and competed with me for the same jobs. *shrug* … and I went to public schools my whole life.

    If you have money to burn, go for it. Otherwise it might do them some good to learn with the plebs.

    • Emily August 1, 2014 at 8:45 AM

      I agree. I went to public school and ended up in the same place as many prep school equivalents. If I had money to burn, I would might put my children in private school, not necessarily because I believe they that much of a better education, but for networking advantages as SarahN mentions in another comment. But since I don’t have money to burn, my child(ren, hopefully) will be educated in the public school system for a cost of $0.

  • Carla May 29, 2014 at 9:42 PM

    Wow…. that’s a LOT of $$. Our income is 1/3rd of yours, so that would not be NEARLY possible for us unless we lived in a box and chose only *one* child to go. lol! However, *IF* you have the $, personally, I think it would be worth it. I homeschool my kids, so i’m not really the best with this one! 😉

    • Emily August 1, 2014 at 8:40 AM

      Choose your favourite to go, Carla ;p To be serious, if I had the skills to be an educator (which I don’t; I’m way too impatient and undisciplined), I would homeschool my kids. I went to a public school but my parents supplemented my education at an early age themselves. In elementary school, my mum did spelling with me and my dad taught me computer languages and basic website design (the internet was fairly new then). In highschool, my dad was my tutor in Algebra and physics since I was a complete dunce in those subjects.

  • SarahN May 30, 2014 at 2:46 AM

    I certainly don’t endorse a two year old going to a private school – but note there are a number of Montesorri styled preschools being constructed around Sydney now.

    That being said, i think it’s more common around Sydney for people to spend the money for a private high school education (5-6 years). That being said, I personally believe the parents ‘paying’ should end at the age of majority, which is what i expected from my parents as a child. In reality, the first year they gave me a head start for living costs (university in Australia is relatively cheap). And my brothers? They got to live at home, therefore reducing their costs significantly. So I do think you can pay for high school without the expectation that university costs will also be borne from the parents.

    I think what some private school education brings is a network. Sure, you are competing for the same jobs, but what gets people jobs are the networks, and I know that ‘old girls’ and particularly ‘old boys’ can benefit from the listing of their high school, if it’s known and prestigious. No one will ever say that’s how a candidate was picked though… Alas, I work in the public service, which denies the ability to trade on my school’s name – no one cares. However, if I was fighting for a spot in a law firm, it might have been another story!

    • Emily August 1, 2014 at 8:36 AM

      I agree with the networking aspect of private school; you’re in a circle of kids where their parents are probably elitist. However, networking takes more than private school education and is an actual skill. And, “names” and connections may not matter, depending on the career or job; in my industry, it doesn’t really matter much. Law, yes, I agree; you need to know people in high places. Same with politics.

  • Alicia @ Financial Diffraction May 30, 2014 at 5:53 PM

    Yeah, those are insane prices… I didn’t go to private school and I’d like to think I turned out reasonably well considering. If I was in a bad school district I would move, but I wouldn’t likely entertain the idea of private school.

    • Emily August 1, 2014 at 8:47 AM

      There is a highly rated highschool in my neighbourhood. Parents rent condos in the area to obtain the address to enroll their kids in that highschool, which is still cheaper than private school.

  • Well Heeled Blog June 11, 2014 at 4:11 PM

    Even if you do have $30K a year to spend on education, I think it’s more useful to save the money for your kid’s terminal degree vs. spending it on preschool / elementary or even secondary education.

    • Emily August 1, 2014 at 9:12 AM

      That’s the plan right now; save the money for post-secondary education vs elementary. To be honest, I think putting a preschooler in an elite school is absurd. Don’t they just play? Can’t the parents read with their children at home and teach them the alphabet and numbers themselves?

  • Newlyweds on a Budget July 31, 2014 at 11:38 AM

    WE make about the same as you guys. I did go to a private $30k a year high school, but it was with a scholarship and my parents paid a little over $5k annually. That being said, $5k was a STRUGGLE for my parents. However, we lived in a really bad area, and the school system sucked. I ended up going to college in Boston and am still really good friends with some of the girls from high school, so I feel very blessed that my parents made those sacrifices for me.
    That being said, my husband and I are in a better place financially than my parents were, and we can afford to live in a better area with really good schools. So no private tuition here! Some people just don’t realize how much priviledge they have until they start making comments like that…
    I actually had my (rich) high school friend tell me recently that it would be hard for us to have 3 kids bc they are SO expensive. And it’s like, yeah, kids are expensive but it depends on how much you spend on them. I’m sure her childhood with au pairs and summer trips to Europe, was a lot different than my childhood. My parent sdid just fine with raising three kids on a budget. It CAN be done!

    • Emily August 1, 2014 at 8:58 AM

      I’m not against putting children in private school and see the merits of it. I was annoyed at how out-of-touch and presumptuous that women was; thought that with a fancy education she would be more open-minded. My best friend went to a private school as well as many of my friends I met in university, and they’re not elitists; guess it was just that lady.

      I agree. The cost of kids depends on how much the parents CHOOSE to spend on them. My parents raised three kids on a budget as well. We never went on vacations and rarely ate out; I had a lovely childhood. Good for your parents for finding that $5K to put you through private school; and good for you for that scholarship!