Child education fund
What college will cost when the child gets there — at education inflation, not general — and what to set aside each month from now.
The two rates — how fast fees rise and what the savings earn — decide this, and neither is known. Plan on the money you put in; treat the growth as a cushion.
4 years at ر.ق 200,000 a year is ر.ق 800,000 today. At 8.00% education inflation, by the time the child is there it is ر.ق 2,450,985.82 — the number to plan for.
Starting now, ر.ق 7,947.52 a month for 13 years gets there. Starting later needs more every month — the first years do the most work.
| College year | When | Cost then |
|---|---|---|
| Year 1 | in 13 years | 543,924.75 |
| Year 2 | in 14 years | 587,438.72 |
| Year 3 | in 15 years | 634,433.82 |
| Year 4 | in 16 years | 685,188.53 |
- Try 10% education inflation — Nepali private colleges have run higher than 8% — and see the monthly amount move.
- Give this its own account in the child's name; a fund that shares the household account is spent as the household.
- Education costs rise 8.00% a year, every year — they have run above general inflation for decades.
- The savings earn 8.00% a year, constant; contributions at month-end.
- Each year's fee is paid at the start of that year; the fund is drawn as needed and does not keep earning on the part already withdrawn.
- No scholarship, no loan, no fee waiver — any of these reduces the need.
A worked example
The form starts with these figures (in QAR) so you can see how it works before typing your own. They are made up — nobody's real numbers appear here.
Questions people ask
Why does college cost three times today's figure?
Because education inflation compounds for thirteen years before the first fee is paid, and for sixteen before the last. Fees have risen faster than general prices for decades; 8% is a moderate assumption.
What if I start when the child is fifteen?
Three years of saving instead of thirteen, and almost none of it from growth. Enter the child's real age and see — it is usually five times the monthly amount.
Should I count a scholarship or a loan?
Not in advance. If one arrives, the fund is simply larger than needed — a good problem. Planning on one that may not come is how families arrive short.
Where should this money sit?
Somewhere that earns above inflation for the long years, moving to something safe in the last two or three — a fall in the final year cannot be waited out.
Do you keep what I type here?
No. The figures are used to work out the answer and are not stored, and never appear in the page address.
These are estimates. The figures depend entirely on the numbers you enter and on assumptions that are listed on every result. They are not financial advice, and a bank, employer or authority may use different rules. Check anything important with them before you decide.
We do not keep your figures. Salary, debt and savings you type here are used to work out the answer and are not stored, and never appear in the page address. The only thing remembered is your country and language choice (a small cookie), so the currency can be suggested next time — never a figure you typed. Anonymous counters record that a calculation happened, not what it was.