What Your Financial Advisor Never Told You

Attention, single people, engaged people, newlyweds, and expectant parents! Whether you are a major spender or a major saver, a planner or a seat-of-your-pantser when it comes to money, there is a dirty little secret that you will never hear from your financial advisor or just about anybody else. Here it is:

Pre-school is as expensive as college, and can last just as long.

If you ever went to a financial advisor, took a personal finance course or read a book about it, you have been repeatedly hit over the head with two things: save for college and save for retirement. But no one ever says “save for pre-school.”

Maybe it is because I live in Boca Raton, but my experience is that the pre-schools cost as much as tuition at a university. All this to teach toddlers their ABCs and to play nice with others. When you have multiple kids in at the same time, of course, the cost grows exponentially. Believe me, I’ve paid through the nose over the years.

My youngest three children were all born in December, which means that they missed the cut-off for kindergarten. Of course, this results in yet another year of pre-school and thousands more out of my pocket. Let me give you real numbers here.

The pre-school I have been sending my girls to for the past five years is a Montessori school right near my house. Their tuition for 8:30 AM to 3:30 PM, five days a week is $850 a month. That comes out to $7,650 for the school year (August through May) per child. Then you have to pay for summer camp, which conservatively will run you $200 a week, so an extra $2000 more or less, for a grand total of $9,650 per year per child. I thought this was expensive, so I looked into other pre-school programs in the area. They are even more expensive. One quoted me a half-day ( 9:00 AM to 1:30 PM) 5 days a week for $8,455 and full day (until 3:00 PM) 5 days for $10,330 a school year. Plus summer camp, of course.

Compare this with college. The University of Florida charges only $4,340 per year for in-state students, half of the pre-school tuition. On the other hand, private university like my alma mater, the University of Miami, is much more expensive. Its tuition is $36,188 two semesters. Yes, it is outrageously expensive. However, college students and their families have financial aid available as well as low interest student loans. On average, almost 80% of students who applied for financial aid got it, and they received over $17,000 against their tuition as a gift, bringing the total cost down to around $20,000 a year, only double the pre-school cost.

In addition, college students can work part-time to offset some of the cost. What are your toddlers going to do to pay for their pre-school tuition? Sell cups of homemade lemonade for $1,000 each?

This year, with the economy in shambles, I have elected to keep my youngest at home and keep that money in my bank. Next year, when she is 4, she will qualify for Florida’s state VPK program, which pays for 3 hours of preschool instruction a day. I think the pre-school deliberately puts the VPK hours in the middle of the day (noon to 3:00 PM) so you will be forced to pay for the “wrap-around program” for $585 a month, but we’ll cross that bridge when we come to it.

In the meantime, my advise to you is save now for pre-school. You will be glad you did!