College Savings Calculator — 529 Plan and Education Fund Target
Education inflation runs hotter than general inflation — typically 7–10% per year worldwide. A college programme that costs $80,000 today will cost roughly $233,000 by the time your 3-year-old is 18. The good news: 15 years of compounding can fully cover it with a manageable monthly contribution.
Child Education Planning Calculator
Plan exactly how much you need to save monthly to fund your child’s higher education.
Education Plan
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Why Education Inflation Is So High
Education inflation outpaces general inflation almost everywhere — driven by rising faculty salaries, infrastructure, technology costs, and demand outpacing supply at top institutions. college costs have risen ~6.5% per year over the last 30 years; India’s premium institutions ~10–12%; UK ~5–7%.
The Math
Required Monthly Contribution = (Future Cost − ExistingFV) × r / ((1+r)n − 1) × (1+r)
Worked Example
Strategy by Time Horizon
- 10+ years away: 80–100% equity (index funds, large/multi-cap). Time absorbs volatility.
- 5–10 years away: 60–70% equity, 30–40% debt. Begin shifting toward stability.
- 2–5 years away: 30–50% equity, 50–70% debt. Capital preservation becomes critical.
- 0–2 years away: Mostly fixed deposits / liquid funds. Don’t risk a 30% market drop right when you need the money.
Education Loans as a Backup
Even with diligent saving, top international programmes can outpace any reasonable monthly contribution. Education loans are a sensible backstop: low rates, deferred repayment, and tax benefits in many countries. A common strategy: save for 70–80% of the goal and finance the rest.
Frequently Asked Questions
Should I use a 529 plan / Sukanya Samriddhi / RESP?▾
How do I plan for two or three children?▾
What if my child gets a scholarship?▾
What if education costs are paid in foreign currency?▾
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