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Is Private School the Answer for Your Kids? At What Cost?


In many areas of the country parents are expressing their dissatisfaction with the quality of public schools by looking for ways to fund a private school education for their children. Is it a good idea, or a financial calamity waiting to happen?

The answer to the deteriorating state of public education for an increasing number of families is to go the private school route, but the obvious obstacle for most is cost. Parents now have more options available for funding a private school education, but, is it good idea or is it a financial calamity waiting to happen?

What’s the Attraction?

When compared to many public school systems, local private K-12 schools stand out as very attractive, albeit expensive, alternatives. Aside from the cost, what’s not to like?

  • Schools are generally smaller with small class sizes
  • Students are selected based on achievement
  • Private schools consistently outperform public schools in academic achievement
  • Teachers are hired, paid, and fired based on merit
  • Private schools are better launching pads for college
  • Curriculums are not mandated by government bureaucrats

Managing the Cost

The first consideration is always cost. As with college tuition costs, private school costs have been increasing at rates faster than inflation, and, in many cases, they rival the cost of college tuition. Depending on the type of school and the region in which it’s located, private school tuition can run as high as $30,000 with $8,000 to $10,000 being the low range. For upper income families, this may not be prohibitive, but the families that are most active in pursuing private schooling are of middle to upper-middle class means, and those costs can severely gouge a budget.

The good news is that there are funding solutions available to families who can qualify financially. They come in the form of financial aid from the private schools, tuition payment plans, and education loans from private lenders. As with a college financing strategy, families should exhaust all financing options before turning to loans as a solution. The first place to look is with the private school.

Financial Aid

Most of the better managed private schools have financial aid programs funded with private grants and scholarships (private schools receive no government grants). Some aid is awarded based on financial need, while scholarships may be awarded based on other factors. Because schools have a limited amount of funding available each year, applications need to be submitted as far in advance as possible.

Tuition Payment Plans

Tuition payment plans are a form of financing available through many private schools. Structured much like a loan, a year’s tuition is advanced based on a schedule of affordable payments.

Private School Loan Options

Not long ago, parents, who were determined to put their kids in private schools, would find the money by working extra jobs or refinancing their homes. More recently, additional financing options have become available that enable parents to take out reasonably priced loans for private education. Sallie Mae has long been a source of college student loans, and it has now made loan packages available for K-12 education loans. You can borrow up to the total cost of tuition with three years to repay it after graduation.

The website, is a great source of private education funding solutions including low cost K-12 loans. Again, you can borrow the full cost up to $40,000 and the payment terms can be spread over seven years. Both of these loan sources require good credit.

While a private school environment may be the better alternative for your kids, it’s imperative to carefully consider the cost of borrowing, especially if you plan on sending your kids to college. A private K-12 education is a life style choice that typical requires some tradeoffs, which if not made, could seriously impact your lifestyle and your ability to fund college expenses. It would be important to work with your Bay Area financial planners in developing a complete education funding plan.

Tax-Advantaged Savings Plans

If you are planning ahead, you take advantage of tax-favored college savings plans to save more efficiently for education expenses. Thanks to the 2017 Tax Cuts and Jobs Act, 529 College Savings Plans now extend to K-12 education, so your tax-free accumulation of savings can by used to pay for private schools in addition to college. Withdrawals used to pay for eligible education expenses are tax-free. You can also use a Coverdale Educations Savings account, but your contributions are limited to $2,000 a year.

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Ready to explore how Sunflower Bank can assist you? Speak to a personal banker at a branch near you, contact a specialist on our Wealth Management team, or find the right financial partner on our Commercial Banking team for your business needs. 

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This article contains general information only. Sunflower Bank is not, by means of this article, rendering accounting, financial, investment, legal, tax, or other professional advice or services. This article is not a substitute for such professional advice or services, before making any decisions related to these matters, you should consult a qualified professional advisor.