Child Education Calculator

A Child Education Calculator helps you plan for your child's higher education expenses by accounting for education-specific inflation and the time until your child reaches college age. It calculates the future cost of education and determines how much you need to save monthly to fund it.

Why it matters: Education costs are rising faster than general inflation-often 8-10% annually. A ₹20 Lakh course today could cost ₹50 Lakh or more in 10-15 years. Early planning is essential to avoid last-minute financial stress.

Our Child Education Calculator provides a complete roadmap for funding your child's education.

Key Benefits:

• Future Cost Projection: See the actual cost when your child reaches college age
• Inflation Impact: Understand how education inflation affects your goal
• Funding Gap Analysis: Know exactly how much more you need to save
• SIP Recommendation: Get the precise monthly investment required
• Timeline Visualization: See your child's education journey clearly
• Existing Savings Credit: Account for money you've already saved

Education costs rise faster than general consumer inflation:

Education Inflation Rates:

• India: 8-12% annually for quality institutions
• International Universities: 3-5% annually (in USD)
• Medical/Engineering: Often higher than average
• MBA Programs: 6-10% annually

Real Examples (Approximate):

• IIT B.Tech (4 years): ₹10 Lakhs today → ₹25 Lakhs in 10 years
• Private Engineering: ₹15 Lakhs today → ₹40 Lakhs in 10 years
• US Undergraduate: ₹80 Lakhs today → ₹1.5 Crore in 15 years
• Indian MBA (IIM): ₹25 Lakhs today → ₹55 Lakhs in 8 years

Planning Tip:

Use 8-10% education inflation for Indian institutions and factor in currency appreciation for international education.

Step-by-step guide to plan your child's education:

Step 1: Enter Child's Current Age

Input your child's current age. The earlier you start, the easier it is to save.

Step 2: Set College Start Age

Usually 17-18 for undergraduate, 21-22 for postgraduate studies.

Step 3: Enter Current Education Cost

Research current costs of your target institution/program. Include tuition, living, and other expenses.

Step 4: Adjust Education Inflation

Use 8-10% for India, 4-6% for international. Premium institutions may inflate faster.

Step 5: Set Expected Investment Returns

Be realistic-12% for equity-heavy, 8% for balanced portfolios.

Step 6: Add Existing Savings

Include any money already set aside for education.

Step 7: Review Results

See future cost, funding gap, and required monthly SIP.

Choose investments based on years remaining:

15+ Years to College:

• Allocation: 80-90% Equity, 10-20% Debt
• Instruments: Equity mutual funds, index funds
• Rationale: Long horizon allows riding market volatility

10-15 Years:

• Allocation: 70% Equity, 30% Debt
• Instruments: Balanced funds, large-cap funds
• Rationale: Good growth potential with moderate risk

5-10 Years:

• Allocation: 50% Equity, 50% Debt
• Instruments: Hybrid funds, debt funds
• Rationale: Start reducing equity exposure

3-5 Years:

• Allocation: 30% Equity, 70% Debt
• Instruments: Short-term debt, liquid funds
• Rationale: Protect accumulated corpus

<3 Years:

• Allocation: 10% Equity, 90% Debt/Liquid
• Instruments: Liquid funds, FDs
• Rationale: Capital preservation priority

If you're planning from abroad:

Currency Decision:

• For Indian education: Save in INR or hedge currency risk
• For international education: Save in the destination currency
• Use currency impact calculator to understand forex effects

Tax-Efficient Options:

• Sukanya Samriddhi (for girl child) if eligible
• PPF for tax-free returns
• Equity mutual funds for long-term capital gains benefits

Education Loans:

• Keep loan as backup option
• Interest rates: 8-12% for Indian education
• Many loans available for top-ranked institutions

Scholarship Planning:

• Research scholarships early
• Build extracurricular profile
• Consider merit-cum-means scholarships

Document Planning:

• Maintain proof of funds
• Bank statements for visa applications
• Loan pre-approval letters if needed

Don't fall into these education planning traps:

1. Underestimating Costs:

Include all expenses-tuition, hostel, books, travel, and living costs.

2. Ignoring Inflation:

A ₹20 Lakh course will cost ₹45 Lakh in 10 years at 8% inflation.

3. Starting Too Late:

Starting 5 years late can double your required monthly investment.

4. Wrong Asset Allocation:

Too conservative early = insufficient growth. Too aggressive late = unnecessary risk.

5. Not Reviewing Regularly:

Review and adjust annually based on actual performance and cost changes.

6. Single Source Dependence:

Don't rely only on investments-have backup plans like education loans.

7. Ignoring Existing Savings:

Account for and properly invest existing education savings.