Our article in The Australian – Education’s $500,000 Challenge

500k education challenge





To read the full article, please click on the links below:

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Principal of FinancialAdvisor.com.au James Gerrard, has written an article in the Wealth section of The Weekend Australian newspaper on private school fees.

He looked at a hypothetical situation where a parent decides to send their children to public school and invest the fees they would have paid for private schooling.

The outcome?  After 13 years of school, modelling based on average property growth rates showed that an investment property could have been purchased for each child which would be valued at $610,000 whilst the investment loan balance would be $90,000.

Thus if private school fees were diverted into property investment, the child would finish school with a property almost paid off with over $500,000 in equity.

The investment property would be positively geared and projected to generate an income of $12,500 per year, enough to help the child cover some of their expenses as they enter adulthood.

It should be pointed out that there are many benefits to private schooling which the article points out such as smaller class sizes and a more tailored learning approach.

There is not right or wrong answers in terms of private vs public, the article was simple to give parents some food for thought on the options they face as they plan for their children’s future education expenses, something that we at FinancialAdvisor.com.au help our clients with on a daily basis.

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