How Much Money Should I Save for a Child’s Education?
Published: July 12, 2021 | Updated: September 22, 2021 | Posted by: Moneymax | Personal Finance
Have you started saving for your child’s future? If so, are you saving enough? To say that the cost of education in the Philippines is expensive is an understatement. Higher Education Institutions in the country increase their tuition and other fees by about 10% year-over-year. However, financially preparing for your kid’s future is doable, if you do it early.
You might think that tuition fees in the Philippines have become lower because students don’t go to school physically and are instead taking distance learning or online learning classes at home during the pandemic. However, this is not the case for most schools because other facilities like internet connection and equipment need to be upgraded to facilitate online classes.
As we all look forward to the reopening of classrooms for face-to-face instructions, ask yourself: How much do I really need to prepare for my child’s education?
Table of Contents
- The Differences Between Private Schools and Public Schools
- How Much Do Tuition Fees in the Philippines Cost?
- Tuition Fees of Top Universities in the Philippines
- The Different Factors Affecting the Cost of Education
- How to Calculate Tuition Fees in the Philippines
- How to Reduce Your Expenses on Your Child’s Education
- 5 Tips on Saving for Your Child’s Education
- Final Thoughts
The Differences Between Private Schools and Public Schools
Knowing how much you need for your child’s education depends on your choice of school. Are you planning to enroll your kid in a private school? Or you’re looking forward to making them a part of the public school system? The rising cost of education in the Philippines depends on so many factors, including whether you’ll send your child to a private or public educational institution.
To help you decide, here are a few of the similarities and differences between public and private schools in the Philippines that you must consider.
Higher Tuition Fees in Private Schools
Public schools don’t charge tuition fees while private schools do. Generally speaking, parents of children attending public schools don’t need to pay tuition fees from elementary to college.
Under the free tuition law signed by President Rodrigo Duterte in 2018, you can send your child to any of the 112 universities that offer free college education. The list includes the Philippine Normal University and the University of the Philippines School System, Don Mariano Marcos Memorial State University in the Ilocos Region, Cavite State University in CALABARZON, and Agusan del Sur State College of Agriculture and Technology in Region XIII.
As more than 250,000 students from private schools transferred to public schools during the pandemic, tuition fees are likely to increase in the private school system to cover for their losses.
Better Facilities in Private Schools
Most private schools charge tuition fees to cover their maintenance and provision of facilities. For one, most private school classrooms are air-conditioned with maintenance staff like janitors and cleaners. Many private schools also have a designated computer and equipment for each child to facilitate digital learning. On the contrary, the public school system may find it hard to provide high-tech equipment as funding is limited.
Larger Class Sizes in Public Schools
Most public schools accommodate up to 65 students per classroom while private school classes are composed of up to 30 students only. Class size often matters for most parents because a small class size means higher chances of focus and learning for students. Also, teachers can better supervise and monitor their students’ progress individually if they handle smaller classes.
Differences in the Medium of Instruction
Public schools use the national language in classroom discussions while most private schools have maintained the use of Filipino and English as the medium of instruction. If you and your kid are not used to communicating in Filipino, then you might find it hard to adjust and understand modules and other printed references in public schools.
How Much Do Tuition Fees in the Philippines Cost?
Knowing how much you should save depends on the grade level of your child. For instance, some schools charge higher tuition fees for grade school compared to high school.
Read on to get an idea of the range of tuition fees in the Philippines.
Average Annual Tuition Costs in Private Schools
Grade School: PHP 25,000 – PHP100,000
Grade school in the Philippines starts from Nursery level to Grade 6. Depending on the school’s location and facilities, you may need to prepare at least PHP 25,000 for school fees alone. Some other fees may include books, uniforms, laboratory, and miscellaneous fees, which will raise the school’s monthly charges.
On average, here’s a breakdown of expenses for private schooling.
|Educational Expense||Average Cost|
|Laboratory fee||PHP 4,000|
|Miscellaneous fees||PHP 7,000|
|Total||PHP 50,000 annually or PHP 5,000 monthly|
High School and Senior High School: PHP 40,000 – PHP 150,000
The K-12 education system added two more years at the high school level for both private and public schools. On average, tuition fees in the Philippines for high school students starts from PHP 40,000. Compared to grade school, high school education covers more subjects, more books, and more requirements that aim to develop the student’s mastery of knowledge and skills.
|Educational Expense||Average Cost|
|Laboratory fee||PHP 7,000|
|Miscellaneous fees||PHP 10,000|
|Total||PHP 77,000 annually or PHP 8,000 monthly|
Read more: Schools with Highest Tuition in Metro Manila
College Level: PHP 70,000 to PHP 250,000
College is probably the most difficult stage for parents, both financially and emotionally. Aside from your child’s education fund getting more expensive, completing a four-year or five-year course can become more difficult for the child.
Tuition Fees of Top Universities in the Philippines
To help you better understand how much you need to save for your child’s education, here are the tuition and other fees in some of the top universities in the Philippines:
1. Ateneo de Manila University
Annual cost of tuition: PHP 170,000 to PHP 190,000
One of only seven Philippine universities in the 2020 QS World Universities Ranking, Ateneo offers elementary, high school, college, and graduate education. The university offers competitive programs in sciences, liberal arts, law, management, and engineering.
Based on its website, ADMU charges the following fees for the School Year 2021:
- Tuition – PHP 92,064
- Basic fees – PHP 12,385.45
- Other fees – PHP 3,750
Take note that tuition fees in the Philippines vary depending on your child’s program of study. Additional fees may also be charged aside from the ones mentioned above.
2. De La Salle University
Annual cost of tuition: PHP 200,000 to PHP 230,000
De La Salle University or DLSU offers courses in communication, sciences, engineering, business, and technologies. The university has three terms, with each term costing an average of PHP 70,000 to PHP 90,000+.
The basic tuition fee charged per unit is PHP 3,604. If your child takes 25 units in one semester, then you need to pay a PHP 90,100 average tuition fee alone. Other fees at DLSU include student orientation for PHP 992, a library for PHP 1,453, and a registration fee of PHP 872, among others.
3. University of the Philippines Diliman
Annual cost of tuition: Free (for qualified students)
UP Diliman has over 20,000 students and houses the greatest number of CHED Center of Excellence in the country. Journalism, computer engineering, philosophy, anthropology, and creative writing are just some of the many courses offered by this university.
Under the Universal Access to Quality Tertiary Education Act (Republic Act 10931), UP is among the state universities with a full tuition subsidy for students. This means free tuition for qualified UP students.
4. University of Santo Tomas
Annual cost of tuition: PHP 100,000 to PHP 150,000
Dubbed as the oldest university in Asia, UST has nine colleges and offers courses in architecture, physical therapy, journalism, among others. It has over 10 CHED Centers of Excellence.
5. University of San Carlos
Annual cost of tuition: PHP 75,000 to PHP 100,000
One of Cebu’s largest universities, the University of San Carlos has the most CHED Center of Excellence in the Vis-Min area. It offers programs in education, physics, engineering, and anthropology.
6. University of Asia and the Pacific
Annual cost of tuition: PHP 180,000 to PHP 190,000
UA&P offers courses in economics, humanities, management, and information technology. The institution also has an international student exchange program, with partner schools in Europe, Latin America, and the Asia Pacific.
7. Silliman University
Annual cost of tuition: PHP 180,000 to PHP 190,000
Siliman has the greatest number of accredited programs in the country. Founded in 1901, the university has degree programs in information and technology, nursing, biology, and marine science.
8. San Beda University
Annual cost of tuition: PHP 180,000 to PHP 300,000
Founded in 1901, San Beda has campuses in Manila, Alabang, and Rizal. CHED also granted the institution university status in 2018. San Beda offers courses in accountancy, marketing, economics, and law.
9. Mapua University
Annual cost of tuition: PHP 145,000 to PHP 210,000
Mapua University is known for its engineering and architecture programs. Eight of the university’s programs are recognized as a CHED Center of Excellence. Mapua has campuses in Intramuros and Makati, and with four terms per year, with each term costing an averaging of PHP 51,000.
10. De La Salle College of Saint Benilde
Annual cost of tuition: PHP 180,000 to PHP 240,000
CSB was founded in the 80s as a night school, but today it offers various courses in the fields of arts and design, international studies, and hotel and management. The school has three terms, with each term costing an average of PHP 105,000
The Different Factors Affecting the Cost of Education
Before you compute the amount to save for your child’s education, consider the things that have an impact on the future cost of education.
1. Your Target School and Course
Do you dream of sending your children to one of the top universities in the Philippines? You should be working harder and saving more because the cost of education in many of the best colleges in the country is expensive.
Your choices are limited if you’re looking for schools that specialize in fields like business, accounting, engineering, medicine, IT, and the arts. If the schools on your shortlist all charge high tuition payments, you must either build a huge tuition fund or keep looking for more affordable choices.
Another option is a state university or college covered by the free tuition law (Republic Act 10931 or the Universal Access to Quality Tertiary Education Act). Qualified students in premier state universities like UP and PUP no longer pay for tuition, miscellaneous fees, and other school fees starting in the academic year 2018-2019.
However, the free tuition law has numerous conditions and restrictions, so you don’t know for sure if your child will qualify for it. Also, it isn’t certain if this law will still be implemented by the time your child enters college.
2. Your Target School’s Current Tuition
Once you’ve determined your target college, find out how much the current tuition is in that particular school. You can find the information on the school’s official website or through search engines for Philippine colleges like finduniversity.ph, among others.
Tuition fees in the Philippines increase by an average of 10% every year—about twice the country’s average inflation rate of 4% to 5%. While the cost of education rises exponentially, household incomes don’t grow as much.
Can you already imagine how costly it will be to fund your child’s education?
3. Number of Years Until Your Child Starts College
Your kid’s age today will determine how long you’ll have to save for their college tuition. A parent with a newborn has 18 years to prepare for the child’s college education. That’s easier to manage compared to building a tuition fund for a 10-year-old kid or older. The shorter the time left for you to save, the bigger the money you have to set aside per month or year.
How to Calculate Tuition Fees in the Philippines
Now that you know the factors that affect the cost of education in the country, you can compute the amount you need for securing your child’s education in the future.
To make it simpler, calculate first the cost of education for your child’s first year in college. Use this formula:
Cost of College Education = Current Tuition in Target School x (1.10 ^ Years Until College)
For example, you want your three-year-old to study in UST 15 years from now. With tuition of PHP 110,000, the estimated tuition cost for 2033 is computed this way:
PHP 110,000 x (1.10 ^ 15) = PHP 459,497.30.
That’s for the first year of college alone. You also need to compute for the remaining years in college, taking into account that tuition goes up by 10% every year. To get the total tuition cost, multiply the estimated tuition for the first year (PHP 459,497.30) by 1.10 for every year that your child will in college and then get their sum.
Assuming that your child will complete a four-year course, here’s how much it will cost you for every year in college:
|Year in College||Estimated Total Tuition|
|First Year||PHP 459,497.30|
|Second Year||PHP 505,447.03 (PHP 459,497.30 x 1.10)|
|Third Year||PHP 555,991.73 (PHP 505,447.03 x 1.10)|
|Fourth Year||PHP 611,590.91 (PHP 555,991.73 x 1.10)|
|Total Tuition||PHP 2,132,526.97|
The estimated total cost of education is over PHP 2 million, which will be your target amount to save for your child’s tuition. The actual cost may be higher or lower depending on your target school, the tuition cost, and how long you’ll save up for it.
You can use a Future Value calculator for a quicker computation.
How to Reduce Your Expenses on Your Child’s Education
You might be overwhelmed by the numbers provided above but that doesn’t mean you can’t do anything to reduce what you’re supposed to pay. Your child’s education is precious, and you can do a lot of things to ease the financial burden.
Here are some things you can explore to check if you qualify. A little help can go a long way, especially if you’re determined to send your children to school.
1. Get Discounts
Private schools grant discounts to early birds and siblings or relatives of their students. If the opening of classes is set in August, early birds can pre-enroll by March or a few months more before the enrollment date. This discount is common in grade school and high school. Available discounts become lower as the opening of classes approaches.
Siblings can also save on books and uniforms. If you have a grade school and a senior high school, you can send them both to the same private school, so you can negotiate on some fees.
2. Apply for Government Subsidies
Yes, private school students can also qualify for government subsidies, such as the following:
Educational Services Contracting (ESC)
This government program seeks to decongest public high schools by granting subsidized education to students who enroll in a private school instead. Instead of crowding classrooms in the public education system, the government makes arrangements with a private school to open enrollment slots to these students for free.
Senior High School Voucher Program (SHS VP)
The SHS VP is another financial assistance program that provides would-be college students with a voucher. The voucher is only for those who completed senior high school from private or public schools and are not ESC grantees.
For students entering college in the National Capital Region, the maximum voucher amount is PHP 22,500. For those in a highly urbanized area, the voucher is worth PHP 20,000 and PHP17,000 in all other locations in the country. The grantees will present the voucher to their selected university or college upon enrolment, and the voucher amount is deductible from tuition and other school fees.
Bayanihan 2 for Higher Education Tulong Program (B2HELP)
The B2HELP is a form of financial assistance worth PHP 5,000 to be given to private school students who have unpaid tuition and miscellaneous fees. As of January 2021, a total of 54,761 grantees benefitted from this program in 2021.
3. Look for Scholarships and Grants
Tuition fees in the Philippines can be lower if you look for scholarships and grants. Universities, colleges, and private schools offer free or subsidized tuition to deserving students. Your child can apply as an academic scholar. The process includes the assessment of previous grades and scores on written entrance exams. Some students also need to undergo interviews. If you want to apply for a scholarship or grant, you need to prepare your Income Tax Return (ITR) as schools also evaluate the amount of subsidy based on the parent’s earnings and financial capacity.
4. Reduce, Reuse, and Recycle
Some books and uniforms can be reused. Look for students within your neighborhood who have taken up the same program or subject as your child. You can pay at a reduced price or you might not know if these hand-me-downs will be given for free.
5. Choose Cheaper Student Accommodations
If you’re sending your child to college somewhere out of your province or city, then you might want to look for cheaper yet more practical accommodations.
Consider dormitories instead of studios and apartments. Dormitories are built for sharing, but these are usually located near the school so that your child can save time and money on commutes.
5 Tips on Saving for Your Child’s Education
Not every parent can choke up millions of pesos out of their bank accounts to pay for college tuition. However, setting aside tens of thousands for a college fund can be burdensome. Here are other ways you can save for your little one’s college education:
1. Start Saving Early
Don’t wait until your kid is five years old before saving for their education. The earlier you start, the longer you have to save for your child’s tuition fund. You can start slowly and allot what you can afford without straining your monthly budget.
Once you’re in a financially better place, you can amp up your savings. The educational landscape in the country changes rapidly; with it comes changes in tuition and fees. So, it’s best to be prepared as early as now.
2. Find the Perfect Saving Strategy
Allot a portion of your monthly salary for your child’s education. It can be as little or as much as you want, as long as it won’t strain your finances. You can also add more to your kid’s tuition funds, every time you receive a bonus.
Another strategy you can try is aiming for a no-spend month. Apart from buying your essentials and paying off bills and debts, the excess money goes to your child’s education fund. The idea is to spend less money and save more for your kid’s future.
You can also aim for a monthly 10% saving rate. This works if you have a stable income with the same monthly salary. You will have a set amount of savings each month. Ten percent may not be much, but it adds up!
3. Invest Your Money
Rather than just saving straight-up, invest your money in an instrument that yields a return of around 8% to 10% or higher. Just a word of caution, though: don’t fall for online investment scams that are rampant these days.
Investing will help bring down your monthly savings while still meeting your tuition fund goal. You can start putting your savings in mutual funds, stocks, VUL insurance, or other investments.
4. Get an Educational Plan
You can get this pre-need plan to save for your child’s tuition for five or 18 years. An educational plan isn’t cheap, but it guarantees that you can send your child to a public or private college or university. This type of pre-need plan also ensures that your child’s tuition for the entire stay in college is covered.
5. Take Out a Loan
You can get a loan for your child’s education from private financial institutions or government agencies. You may take out loans from CHED, GSIS, and SSS.
If you are a GSIS or SSS member, you can get an educational assistance loan, with a financial aid of up to PHP 20,000. CHED also offers a student loan program for tertiary education. The amount you can get depends if its’ a short-term or long-term loan. However, you can use the financial aid to buy books, tuition, and fees, or other education-related supplies.
You may also turn to a private financial institution to fund your kid’s cost of education. Private lenders typically have higher limits on financial aid. Consider getting a personal loan based on your kid’s needs. Of course, you still must ensure you can afford the monthly repayments or you may find yourself racking up debts left and right.
Education comes with a hefty price tag, particularly tuition fees in the Philippines. However, it can help secure your child’s future—and it’s a legacy you’ll want to leave behind for your little one. Start as early as now and find a savings strategy that won’t jeopardize your finances. You can also invest your money to yield some returns. A loan may also help. However, make sure that the repayments won’t cripple you.
-  Addressing the rising cost of college education in the Philippines (Charland, Philstar, 2018)
-  LIST: Universities and colleges with free tuition starting 2018 (CNN Philippines, 2018)
-  DepEd: Over 250-K students transferred from private schools to public schools (Inquirer.net, 2020)
-  UP and Ateneo Continue to Lead Philippine Universities at World University Rankings (Chua, Esquire, 2020)
-  San Beda College granted university status (Guno, Inquirer, 2018)
-  Future Value (Investopedia, 2020)
-  Senior High School Voucher Program Guidelines (DepEd, 2017)
-  54,761 private school students benefit from Bayanihan 2 subsidy (CHED, 2021)
With a goal to help Filipinos lead healthier financial lives, Moneymax regularly publishes tips and tricks on personal finance and lifestyle, among many other topics. For more finance-related news and articles, follow Moneymax on Linkedin.