Congratulations to all those starting their third level courses today! No doubt those places were hard earned, with increased point requirements and level of competition for places in third level, it will have been a stressful year for many.
Hopefully the journey will not now be the start of a stressful financial journey for all those proud parents starting this journey of seeing their child through third level.
It is for that reason, that we start the conversation about education saving and the need to start to save for these college years, which as every parent will testify, come around far too quickly!
While primary and secondary school costs can mount up and need planning for, third level costs are without doubt far higher. Take this into account that most students will have to live away from home, it is easy to see how costs can spiral.
First off, all ‘free-fees’ third level institutions charge a mandatory student contribution the maximum rate for 2017-2018 is €3,000 per year.
The Zurich Cost of Education Survey 2017 found that when it comes to third level, unsurprisingly accommodation represents a substantial average annual cost. The average annual cost for a student renting accommodation is €3,866, and a marginally cheaper alternative is student accommodation, which costs around €2,628*.
Of those in rented accommodation, 26% pay €6000+ per academic year. Given the cost of accommodation it’s not surprising to learn that 60% of third level students currently live at home. But living at home might not be an option, depending on the desired course and college location.
Over 80% of parents who took part in the Zurich Cost of Education Survey 2017 research study said that they support their children financially outside of rent, transport and college fees. Over the course of an academic college year, the average spend on financial support was €2,016.
The Zurich Cost of Education Survey 2017 heard from parents nationwide and nearly half (46%) said they use savings to pay for their children’s education with 39% using their monthly income.
More than two thirds (69%) of parents said that their children have a job as well as attending college, which is understandable given the mounting cost of college. Although university students may be able to help out by undertaking some part-time work, given the increase in the cost of living it’s unlikely they will be able to contribute in any significant way.
The Cost of Third Level Education
| ITEM | ESTIMATED COST |
|---|---|
| Rented accommodation | €3,866 |
| Fees | €2,066 |
| Student accommodation | €2,628 |
| Transport | €258 |
| Financial assistance | €2,016 |
| Annual Cost | |
| With rented accommodation | €8,206 |
| With Student accommodation | €6,968 |
| Living at home | €4,340 |
| Lifetime Cost | |
| With rented accommodation | €32,824 |
| With Student accommodation | €27,872 |
| Living at home | €17,360 |
Building up funds
A great education is the best possible start in life and for most parents ensuring they can provide for their children’s education, from primary school right through to third level, is crucial. However it is clear from the above Cost of Education research carried out by Zurich that college education is expensive and by the time a teenager reaches third level, parents are really feeling the pressure of funding their children through university or college.
In third level, 73% of parents find covering the cost of this level of education a financial burden. While the figures for parents getting into debt for primary and secondary school are much lower, when it comes to funding university students, over 50% of parent find that they get into debt to cover the costs.
One measure families can take to help avoid putting their households under severe financial pressure, or pushing them into debt, is to ensure early planning around their children’s education, adopting measures such as early life savings schemes. Of those surveyed for the Cost of Education report two thirds (66%) of parents have or plan to set up a savings account for their children.
Like any of our good intentions, sometimes it is simply setting up such a Saver is the hard part. So like a New Year’s Resolution, use this week, the return to college week for many, to set about setting up that Saver. There are many ways to save, from saving in the Credit Union for example to setting up a long term regular savings plan which will be invested in funds suitable to your risk profile and length of investment term.
If you wish to discuss your options in this regard, please contact us at 053 9233640.
