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Are you financially prepared for your children’s education?

Raising a child is expensive. One of the few constants about having kids across Australia is that you have to ensure you are emotionally, psychologically and financially prepared for them. The first two are hard enough, but making sure you have your money in order to care for a child can be downright devilish.

While food, housing and clothing can take up a significant portion of your income, one of the oft-forgotten hurdles when you first decide to have a baby is the cost of education. It may seem like a distant future, but the fact is that primary, secondary and potentially tertiary education exists as one of the most significant costs you will need to tackle when Junior grows up.

Here at Police Bank, we want to make sure you are prepared for anything, so let’s take a look at the education situation and what expenses you need to be ready for.

A growing trend

Education is one of the fastest-growing expenses in Australia. In fact, according to the Australian Bureau of Statistics data for the March quarter, education has had the largest growth of any common piece of expenditure, including inflation.

Staying healthy has increased in cost on average by 1.9 per cent since December, and insurance has grown by 0.6 per cent, but both of these have been outstripped by the price of learning: This has grown by 3.1 per cent.

The rapid increases should be putting education at the front of your mind, particularly considering that inflation itself only grew by 1.3 per cent. If this trend continues, this could well become a serious impost on your finances.

Tallying the expenses

Depending on whether you decide to send your child to public or private school, the price of education can be significantly different. However, even only utilising government schools until the end of year 12, there are still total costs of $22,000, according to 2012 data from the University of Canberra.

Want to pay for university? This then increases to $45,500. Private schools and university? A whopping $191,000 – half the price of a home in some states!

Investing in education is possibly one of the most important decisions you will make, and it pays to ensure that you have the right plan in place for your child’s needs. If you want to take control of your finances and secure a comfortable future for your family, make sure you get in touch with the financial planning experts at Police Bank.