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Wednesday, April 22, 2015

How much will my child require for Tertiary Education?

There is a calculator available on the OCBC website which gives a gauge of how much one will need for tertiary education in X years time.  I find it useful as they differentiate between local and overseas, general and medical degree, and different countries.

http://www.ocbc.com/personal-banking/education/

i remember when K was born and i was working the numbers, i had to use my excel worksheet to do my workings and work out the numbers!   if i had such a calculator then, it would have saved some time! Haha.


Honestly, i dislike such calculators! whenever i see the numbers, i feel like fainting :p  like those retirement calculators ..... the target amounts are always so unattainable! haha! Ok ok, this calculator is not that scary! those retirement planning calculator is far scarier!! LOL.

but i think it gives a very good gauge of the financial commitment required and helps me to validate whether we are on track :) and personally, i think for the local general degree cost estimation, i would increase the amount by another 20%-30%.

Currently, after keying in the parameters into the calculator on the OCBC website, it shows that K will need approximately S$51K  for a general degree course (tuition and living costs included).

For a "sanity" check, i did a quick check on google on the current cost of a business administration degree (guess that is considered a general degree??). 

For SMU (Singapore Management University), a 4-year business degree course will set one back S$44,800 (tuition fees alone) See link

For NUS (National University of Singapore), a general business degree will cost S$31,500 (tuition fees only) per this link.


So in about 11 years time, when K is of university-going age, assuming an inflation rate of between 3%-5% per annum, fees could easily be 30-50% higher than now.

So that's why i say for planning purpose, better to set aside  another 20%-30% more to the OCBC figure.  and have in mind that that will only suffice for tuition fees.  better to set aside a separate amount for living costs.

And that is only for local universities!! If one is looking to go abroad, the numbers will naturally be greater. 

And that is why i marvel at those with a few kids .... what a financial commitment catering to the children's education! it's no wonder that in most families, both have to work! Otherwise how to find the moolahs?? o but of course, i am not talking about the well-to-do families here ;)  happy for those who have already set aside sums for their kids education and do not have to worry about it! :)

Us?  well, we have set aside a sum enough for local tertiary ..... if she wants to go  overseas to study -- she will have to find the means herself ..... :D  that's what i say now! let's see how things go in 10 years time!!

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