Advertisement
spending

An Important Choice: Public or Private School?

If you are at odds over this big decision, here's how to frame the choice, consider the consequences and come to a consensus.

Deciding whether to send your children to public or private school is a huge financial decision, but it’s also fraught with emotions, biases and deeply ingrained personal histories. There is no one right formula or answer to help people determine what’s right for them, but it’s helpful to understand what’s influencing the decision.

Especially with couples, who may have different points of view, the education conversation improves when there’s awareness about emotional triggers, clearly established priorities, the right facts and a framework for decisions.

Advertisement - Article continues below

As a financial adviser, it’s my job to help people make good choices. Here is my advice for clients wrestling with this decision.

Understand emotions

Everyone has a personal or family history or a set of cultural values that factors into our thinking about how our children should be educated. For some, public school is an important tradition and reflects commitment to their local community and its diversity. Perhaps both parents are products of a great public-school education, or they moved to a town with high taxes to support excellent schools, and it’s an easy decision that saves a lot of money.

For others, the topic is less clear-cut. Perhaps there is a long line of family members who have attended private school, and it feels like an expectation rather than a choice. Other factors can include a struggling student, the appeal of smaller classrooms, or the desire for a religious influence in the curriculum.

Advertisement - Article continues below
Advertisement
Advertisement - Article continues below

The first step is to articulate how you feel about the decision, and in couples, make sure you are listening, if opinions don’t align perfectly.

Clarify priorities

When I’m working with clients, I try to help them gain clarity about their real values and priorities first, using an exercise that asks them to make trade-offs until they have their own list of priorities. Then they can negotiate a shared list as a couple. As an example, one spouse may prioritize spending time with people they love, while the other may prioritize maintaining a certain lifestyle. Through conversation, couples can discuss their priorities, identifying those they share. They can develop a list that becomes their framework to guide them as they consider the impact of big decisions.

Get the facts

The biggest mistake parents make when thinking about paying private school tuition is failing to forecast the long-term impact of using excess cash flow now instead of saving it for later. Especially when it’s an emotional decision or expectation, clients want to just close their eyes and say yes. It’s critical to quantify all expenses and make a reasonable cash flow forecast for the next several years to see how that affects finances and other goals and priorities, including funding college accounts and retirement plans.

Advertisement - Article continues below

Many couples today have deferred having kids until their mid- or late 30s and are in their 40s when children begin school. These can be peak earning years, but they are also peak saving years, and that’s sometimes lost if children attend private school. By the time children are in college, parents may face a serious retirement saving gap. An honest discussion on cash flow and savings rates over time is important, and the downstream impact should always be considered when parents ask, “Can I afford private schools?”

Establish a framework for decisions

For most clients, the analyses are eye-opening, and they are more aware of the importance of their decision. Identifying the priorities for each person and couple is extremely helpful when it’s time to make up their minds. The goal is to use the family resources for what’s important—as private schools may be—without sacrificing the overarching priorities for quality of life and financial security, among others.

Advertisement - Article continues below

One way to balance these goals is to get creative with making trade-offs so that the decision has more than one black or white variation. As example, to achieve their goals for private education, are they willing to trade:

  • K-12 private education for a four-year program instead?
  • The assumption that all kids will be treated the same for a more individual decision?
  • Some independence in return for asking grandparents to chip in?
  • Having one spouse stay at home versus returning to work?
  • Cutting other expenses to free up cash flow?
  • Pushing planned retirement from 63 to 67?

Find the right answer for you

Going through the process will often lead to a clear decision on forging ahead with a private school education or not, because parents are making an informed decision having weighed all the aspects that they can articulate to family and friends.

Ultimately, knowing your priorities and having conversations that deal with emotional and factual truths result in making choices with clarity, confidence and control—living the life that’s right for you.

Advertisement

About the Author

John Bratschi, Investment Adviser Representative

CEO, Prio Wealth

John Bratschi is CEO of Prio Wealth, a $2.7 billion registered investment advisory firm in Boston that helps clients prioritize their financial and life goals. With over 33 years' experience in the financial services industry, John works to integrate each client's individual priorities with their plans and portfolios and gives them a framework to make better choices every day.

Advertisement

Most Popular

How To Buy a Roth IRA When You Make Too Much To Qualify For One
Roth IRAs

How To Buy a Roth IRA When You Make Too Much To Qualify For One

With their tax-free growth and tax-free withdrawals, Roth IRAs are a great deal — if you qualify. If you don’t, well, there’s still a way to get into …
September 23, 2020
Social Security Recipients, Veterans Must Act Now to Get Extra $500 Stimulus Check
Coronavirus and Your Money

Social Security Recipients, Veterans Must Act Now to Get Extra $500 Stimulus Check

The deadline for seniors and veterans to request an additional $500 stimulus check for a dependent child is approaching fast. See how you can claim yo…
September 25, 2020
High-Tech Aids for Aging in Place
Caregiving

High-Tech Aids for Aging in Place

Apple Watch and other technology provides fast feedback, comfort for older users, and a powerful assist for caregivers.
September 23, 2020

Recommended

When Is Amazon Prime Day 2020?
spending

When Is Amazon Prime Day 2020?

Circumstances beyond its control have forced Amazon to move its annual Christmas-in-July Amazon Prime Day blowout sale in 2020 to ... later. Is Oct. …
September 22, 2020
Check Your Financial Adviser Now (and Every Year) or Regret It Later
wealth management

Check Your Financial Adviser Now (and Every Year) or Regret It Later

Fewer than 10% of investors use such free background checks as Investor.gov, BrokerCheck or IAPD to check their financial advisers’ backgrounds. These…
September 21, 2020
A Step-by-Step Guide to Being an Estate Executor
retirement

A Step-by-Step Guide to Being an Estate Executor

Whether you’re planning ahead for your own heirs or have been asked to serve as an executor of an estate for someone else, it pays to understand what …
September 17, 2020
18 Things You Can't Return to Amazon
Smart Buying

18 Things You Can't Return to Amazon

Before tossing these items into your virtual shopping cart, be sure to read Amazon's return policy first.
September 17, 2020