Private School: How to Figure Out If You Can Afford It?

We all want to give our kids a great education. For some of us, that means sending our children to a private school. But before you start going on tours and filling out applications, think hard if you really can afford such an investment.

I was recently chatting with some fellow parents at my daughters' preschool. I noticed that some of the moms said they were planning to send their kids to a private school starting in kindergarten. Since my children don't attend a particularly fancy program, I decided to break with etiquette and ask these women if they had done the math. In other words, did they actually sit down and figure out how much some of these highly regarded institutions would cost them on a pretax basis.

Not surprisingly, none of the parents had run the numbers or thought through what their total costs would be. These mothers didn't realize that private schools are a bit like colleges. Tuition is just the beginning of your financial obligation. And unfortunately, it's not a preschool's job to help you figure out your finances before you select a kindergarten.

Your accountant may not be that helpful either. I recall asking mine how much I would have to earn to comfortably afford a private school and he wouldn't answer the question. That's because, he said, sending a child to an independent school is a very personal decision and many families are willing to rob their nest eggs just to give their kids the best.

In case you're thinking of sending your little one to a private school, here are some considerations that can help you figure out if you truly can afford it:

The Private School Math
First, I believe you need to take care of some financial housekeeping before you start writing tuition checks. Are you already maxing out your retirement savings? And, are you currently saving for your child's college education? If you haven't opened up a 529 plan for your little one and you can't imagine how you'll ever pay for her university education, then chances are private school is a bit steep for you right now.

Next, make sure you do the math accurately. The average private school tuition is $18,347 a year, according to the National Association of Independent Schools (NAIS). But prices vary quite a bit. In New York City, tuition is often $30,000 and more. Find out what prices are in your region and then figure out how much pretax money you'll need to earn to cover the cost.

As I mentioned earlier, private school fees can add quite a bit to tuition. So make sure you investigate how much you'll be charged for things like lunch, bus service, sports equipment and books. Transportation alone can add a couple thousand dollars to your tab.

Most private schools are also looking for families that can make donations. While some headmasters may simply hope you'll be generous, others may put pressure on you to give. According to the NAIS, 60% of parents make gifts and give an average of $1,707.

Finally, your kids may feel some peer pressure to keep up with their friends. If private school is a stretch, you may not like your daughter coming home and asking why your family doesn't get to go skiing during winter break. You may also find your child starts whining for more elaborate birthday parties and fancier clothing. Sure, you can say no to all of these things, but chances are you'll give in to a few requests if it means your little one will fit in a bit better with her peers.

Having said all that, I think I should disclose that I went to a private high school and loved it. So I'm not against independent education. I'm just concerned that too many of us spend beyond our means, especially when it comes to providing for our children.

Do you plan to send your kids to private school?

Stacey Bradford is the author of The Wall Street Journal Financial Guidebook for New Parents.
School Bus image courtesy of Flickr, CC 2.0.
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