The ABCs of affording school

It’s never too early to prepare for one of the biggest expenses faced by families: education. Joan and Arlene, San Francisco residents, were a bit unsettled when they came to see me. They were concerned about the impact of school choices on their savings plan and their children’s lives.

You can face this dilemma anywhere in the Bay Area but particularly in San Francisco. School choices involve serious trade-offs. A year in private school can run $20,000 to $35,000. Educating two children through 13 years of schooling (K-12) can cost $520,000 to $910,000. And that’s at today’s tuition rates. That’s a lot of potential savings you would forgo.

These kinds of numbers motivate families to leave San Francisco at an alarming rate. Yet many parents — Joan and Arlene included — would be far happier in the city. So how do they (or you) make the best decision?

Start with due diligence. Visit many public schools, including charter schools. Meet principals. Talk with parents. Be aware that you may also have to navigate the lottery system. San Francisco offers a number of good public schools, but you have to spend the time necessary to find them and push for admission.

Private school? The same advice applies. Remember, each school has its own personality. An impressive school might not be a fit for your child — or you. Moreover, many private schools expect donations as well as tuition.

If you find a private school you like, examine payment options. Scholarships and financial aid may be available. You have to do your homework, and ask.

Moving to the suburbs to live near good public schools can save a lot of money. Still, you have to study each district and school. You should also consider whether the child-centered suburbs are right for you, and how much commuting will cost in time and dollars.

On the other hand, housing tends to be less expensive in many fine suburban communities. Combine lower down payments and mortgages with free schooling, and you have a great opportunity to save for college expenses.

Regrettably, college costs have risen much faster than the consumer price index. So saving money in the K-12 years can help you put your kids through college without saddling them with crippling debt for years, even decades.

Remember, too, that you have options. State schools aren’t cheap, but they cost a lot less than private ones. And you have other possibilities to consider for paying those bills. Many grandparents have accumulated sizable assets and want to help their grandchildren. Talk to your folks.

Look at scholarships, too. A student doesn’t have to be an athlete to get one but generally needs top grades. Some outstanding — and expensive — schools will pay for a worthy student’s education if the family doesn’t have the money. Many organizations also offer scholarships. Use the Internet to research how your student might qualify for financial aid. You can start at

Consider community colleges. They’re low-cost gateways to four-year schools. And which schools “must” your children attend? Truth be told, not everyone needs a degree from Stanford or Harvard. A pricey degree may not yield a major income advantage. Think about what investment you really need to make to offer your child sound career and income opportunities. And remember, it’s what a student puts into his or her education — and the job search — that counts.

A few important points by way of summary:

• Public or private, each school is unique. Look for the right match for your unique student.

• The suburbs can be very attractive, but not to everyone. If you do move there, you still need to do your homework.

• You may find more options to pay for college and private school expenses than you realize. Do some digging.

• The “best” colleges aren’t always the best choices for every student. Most of life gets determined after graduation.

Balancing a quality K-12 education with money you could save for college or retirement can be complex. The more you’re informed, the better decision you’ll make for your children and for you. My next column will address investment options for higher-education expenses.


Ira Fateman

Ira Fateman is a certified financial planner at SAS Financial Advisors in San Francisco. He can be reached at (415) 277-5955 or [email protected].