Child Education Cost Calculator
Project the future cost of your child's university education with inflation, and how much to save each month to cover it.
Typically 17–18 in Australia.
Most Australian students study in Commonwealth-supported (CSP) places, meaning the government subsidises a portion of fees.
HECS fees have historically increased by ~3–4% per year. Use 3.5% as a reasonable default.
How much have you already set aside for this goal?
Expected annual return on savings/investments. Savings account: ~4–5%. Diversified index fund: ~6–8%. Use a conservative estimate.
Step 1: Enter your child's current age and the age at which you expect them to start university (typically 17–18 in Australia).
Step 2: Select the type of degree and course duration. Medicine and Law typically run 5–6 years; most undergraduate degrees are 3–4 years.
Step 3: Choose the study type. Most Australian students access Commonwealth-supported places (CSP) through HECS-HELP, which means the government subsidises a significant portion of fees. Full fee-paying is less common for domestic students but applies to some graduate-entry programs.
Step 4: Set an inflation rate for education costs. HECS fees are indexed to CPI annually — 3.5% is a reasonable default.
Step 5: Enter your current savings and expected return to see how much you still need to save each month.
Important: This calculator projects tuition costs only. Budget separately for living expenses, textbooks, and other costs — add $15,000–25,000 per year for students living away from home.
Formula
Future annual cost = Current annual cost × (1 + inflation)^years until university
Total future cost = Sum of annual costs over course duration (each year increasing by inflation)
Future value of current savings = Current savings × (1 + return)^years until university
Amount needed = Total future cost − Future value of current savings
Monthly saving (PMT) = Amount needed × monthly rate ÷ ((1 + monthly rate)^months − 1)Frequently Asked Questions
How much does university cost in Australia in 2024?
For Commonwealth-supported places (CSP), annual student contributions range from approximately $4,200 (some nursing/education subjects) to $15,000+ (law, medicine, commerce). Most degrees cost $8,000–$15,000 per year in HECS. Over a 4-year degree, expect total tuition costs of $30,000–$60,000. International students and those in full-fee places pay significantly more — often $30,000–$50,000 per year. Living costs add another $15,000–25,000 per year if your child moves away from home.
Should I pay upfront or let my child take on HECS debt?
HECS-HELP debt in Australia is arguably one of the best forms of debt available: it's interest-free (indexed to CPI, not a commercial interest rate), there are no repayments until your child earns above the repayment threshold (~$51,550 in FY2024), and repayments are automatic via the tax system. Many financial advisers suggest investing the money you'd use for upfront tuition payments rather than paying upfront — the investment return often exceeds the CPI indexation on the HECS debt. Upfront payment does provide a small discount (currently 10%), which may tip the calculus if you have the cash.
What is the best investment account for children's education savings in Australia?
Australia doesn't have a dedicated education savings account like the US 529 plan. Common approaches include: (1) High-interest savings account in your name earmarked for education — simple, safe, low return. (2) Investment bonds (e.g. Generation Life, Foresters) — tax-effective after 10 years, no CGT on withdrawals. (3) Micro-investing apps (e.g. Raiz, Spaceship) in the child's name — low minimums, diversified ETF portfolios. (4) Direct ETF investment via a brokerage account — higher returns over long timeframes but with market risk. For a 10+ year timeframe, a diversified share portfolio often makes most sense.
What if my child doesn't go to university?
No problem — education savings in your name remain your money. You can redirect the savings to other goals (retirement, a gift for a house deposit, travel). If the funds are in an investment bond in the child's name, check the bond's terms for withdrawal conditions. The key insight: saving for education is really just general wealth-building with a label — the money isn't locked away unless you've chosen a specific product designed that way.
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