How To Afford Private School

Private School

Private schooling is an important priority for many families. It can offer smaller class sizes, specialized curriculums, and a conservative learning environment, all appealing features that many families see as an advantage over public education. However, the costs associated with private school can be intimidating — enough for some families to consider other options.

Fortunately, there are several ways to reduce the overall cost of private schooling. Many families consider scholarships, financial aid, payment plans, and education loans to make private schooling a more palpable investment.

Understanding the Costs of Private School Education

The cost of private schooling will depend on several factors, including the type of education. For example, the average annual tuition for private K-12 schools is $12,350. Private high schools require an average tuition above $16,000, and private universities cost nearly $33,000 each year.

Your location can also affect schooling costs. While the average private school tuition in Mississippi is less than $6,000, it costs nearly $29,000 in Connecticut. Expenses like uniforms, textbooks, extracurricular activities, and transportation can further inflate this price tag.

While public education isn’t exactly cheap, it can offer much more affordable pricing than the private schooling model. For example, students who attend public, nonprofit colleges for four years can expect to pay $28,421 each year. Students who attend a private, nonprofit college for four years will pay $58,628 per year, a 52% price increase.

Funding Options for Private School Education

Paying for private school can feel like a steep challenge, particularly for those without a large income. However, careful planning and financial assistance options can make the cost of tuition, uniforms, and other expenses more affordable.

Consider scholarships, grants, private financial aid, loans, and payment plans when budgeting for private schooling.

Scholarships and Grants

Scholarships and grants are both popular forms of financial aid for private schooling, as they typically do not need to be repaid. A scholarship is a financial award given to a student based on their academic performance, talents, or background. Grants are a specific form of financial aid given to students who experience financial need.

When applying for a grant, families must provide proof of financial hardship, including documents like tax returns. Schools and organizations awarding scholarships often require an application essay, recommendation letters from peers, and proof of their achievements.

With high competition for limited funding, finding a scholarship can be challenging — particularly if you’re seeking a scholarship for K-12 education. Make sure to start your search early, collecting documents and submitting applications well before due dates. Explore online databases for up-to-date information on scholarship and grant types, amounts, and eligibility requirements.

Private School Financial Aid

Needs-based financial aid is offered to families based on their unique financial situation. A school will examine how much a family can pay toward their child’s tuition and offer financial aid that provides some, or all, of the remaining money they need.

Merit-based financial aid is awarded to families based on students’ accomplishments. Schools often award a set number of merit-based aid packages to students with exceptional talents, achievements, and academic potential.

Parents can reach out to their child’s school to request eligibility requirements for financial aid. Some external financial aid programs also award needs- and merit-based financial aid that supplement the money a school provides. In both cases, families must submit an application process, including financial aid forms and financial documentation, to qualify.

Education Loans

Many banks, credit unions, and private lenders offer education loans to cover private school tuition, uniforms, and other expenses. Loan terms, interest rates, and eligibility will depend on a family’s financial situation, credit history, and the institution offering the loan.

While an education loan can help a family send children to private school, they must be paid back with interest. Loans can range from a few years to decades, with payment plans that last far longer than the education period itself.

If you’re seeking an education loan for a child’s private schooling, prioritize options with fixed rates. This ensures you will pay the same amount for the entire life of the loan. If possible, opt for a shorter loan period with a higher per-month payment — reducing the amount of interest you’ll pay over time.

529 Savings Plans

A 529 savings plan is an investment account specifically made for educational expenses. These accounts are sponsored by state governments and are tax-free as long as funding is used for education-related costs like tuition, books, and uniforms. You can make tax-free withdrawals from a 529 savings plan, up to $10,000, to pay for your child’s K-12, high school, or college tuition.

Stock Loans for School Funding

Parents with stock investments can also use stock loans to fund private schooling for their children. Borrow money against the value of the stock you possess, without selling those stocks, to unlock the funds you need for your child’s education.

Download the Free Stock Loan Calculator

Your portfolio’s value can be unlocked even if you don’t sell a single share in the open market.

If you haven’t checked it out already, here is a free stock loan calculator to help you size out a loan for your shares.

Simply enter a symbol and the number of shares you own, and you’ll see a potential loan amount that we can fund quickly.

Download the free Stock Loan Calculator now

Stock loans allow you to obtain funding by leveraging your stock holdings as collateral. The total value of your loan is calculated as a percentage of your stock’s total value, a figure known as your loan-to-value (LTV) ratio. A typical LTV ranges from 40-60%.

Interest rates on stock loans are typically lower than unsecured personal loans, as your loan is secured by the stock you offer as collateral. Make sure to accurately calculate your stock loan amount when estimating loan terms and repayment dates.

Payment Plans and Discounts

Many private schools offer payment plans that distribute tuition costs over time. These plans give parents several months, sometimes the entire school year, to pay their child’s tuition — rather than in a single lump cost.

Look for tuition discounts that allow families to pay less under certain circumstances. For example, some schools offer a sibling discount that reduces student tuition if multiple children are enrolled at the same time. Other schools discount tuition if parents pay the entire year’s tuition upfront or if they refer new students to the school.

Connect with the school’s financial department for more information on payment options. Ask for a complete list of available discounts and how to combine these discounts with a payment plan. You can also ask about any additional financial aid opportunities, including scholarships and merit- or needs-based assistance.

Additional Considerations When Choosing Private School

Choosing a private school for your children is a significant financial investment. It’s important to select an educational environment that aligns with your family’s values, your financial situation, and the long-term educational goals you set for your children.

Examine your expenses to confirm that a preferred school fits within your budget. Include tuition, fees, uniforms, textbooks, and any other costs you anticipate. Subtract any scholarships, discounts, and financial aid you anticipate using from that total amount.

Long-Term Financial Planning

Download the Free Stock Loan Calculator

Your portfolio’s value can be unlocked even if you don’t sell a single share in the open market.

If you haven’t checked it out already, here is a free stock loan calculator to help you size out a loan for your shares.

Simply enter a symbol and the number of shares you own, and you’ll see a potential loan amount that we can fund quickly.

Download the free Stock Loan Calculator now

Private schooling isn’t typically a one-year investment. K-12 education takes more than a decade, and many private elementary school students go on to accrue additional expenses in college. For parents handling these costs, it’s important to incorporate tuition payments into long-term financial planning.

Investing in your child’s education is important. However, prioritizing education expenses over other financial goals can have negative consequences. Without proper planning, covering private schooling costs can reduce retirement contributions, deplete your emergency fund, and create high levels of financial stress.

Establish clear parameters around your income, to ensure a set percentage is reserved for private school payments and personal savings, retirement, and discretionary funds. This allows you to protect your own financial goals — positioning your finances in an even better state to pay tuition over time.


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