Financing Basics

There are several ways to finance a private school education, learn more about your options here. We'll explore some of the most expensive schools, explain why tuition is rising and show you how it's all paid for.
View the most popular articles in Financing Basics:
Updated   January 08, 2018 |
The New Tax Code's Implications For 529 Plans
Changes to the Tax Code in late 2017 included the addition of saving for K-12 private school education to 529 plans. We take a look at what this means for families thinking about private school for their children.

President Donald Trump signed An Act to Provide for Reconciliation Pursuant to Titles II and V of the Concurrent Resolution on the Budget for Fiscal Year 2018 on Friday, December 22, 2017. While the Act has effects on a wide range of tax situations, for this article we shall examine the effects the Act will have on the tax-advantaged savings plan known as the 529 plan.

The United States Securities and Exchange Commission defines 529 Plans as follows:

"A 529 plan is a tax-advantaged savings plan designed to encourage saving for future college costs. 529 plans, legally known as “qualified tuition plans,” are sponsored by states, state agencies, or educational institutions and are authorized by Section 529 of the Internal Revenue Code."

The IRS offers a detailed explanation of 529 plans. The following video answers the question "What is a 529 plan?"

What the recently enacted changes to the tax code did to 529 plans is to add K-12 private schools. 529 plans now permit you to save for both college educations and K-12 private school educations.

An Overview

Now, just as is the case with private schools, perception often clouds reality. The popular press frequently refers to private schools as elitist and for rich kids. The same stigma will undoubtedly be leveled at the expansion of 529 plans to include K-12 private schools. But when you actually examine 529 plans as a whole and more specifically the 529 plan which operates in your state, you

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Updated   May 07, 2016 |
Why Does Tuition Vary So Much?
How can you compare schools objectively when the costs seem to be so different from one school to the next? We look at some of the reasons why tuition varies so much.

Beginning the school search process is a lot of fun. Those beautiful photographs of tree-lined campuses and sports activities, the candid shots of classroom scenes portraying kind, patient teachers, the history of the school and its many accomplishments over the years as well as all those famous graduates - it is all very impressive. So, you make a list of schools which you want to examine in greater detail. At this point in your school search process,  the question which I posed in the title of this article begins to surface.

I can hear you wondering how you are going to compare schools objectively when the costs seem to be so different from one school to the next.  One boarding school charges $56,000 for tuition, room and board while another school in the same state lists its tuition, room and board as $28,000. Why, then, do some schools cost so much and some cost so little?

Boarding schools

Your costs for schools which charge the most for their services range from $45,000 to $65,000. These schools are residential schools or what we commonly call boarding schools. As well as charging for tuition and related expenses, these schools have to bill for room and board. You will notice that some schools offer two types of boarding arrangements. One is the customary seven-day a week boarding; the other is a five-day boarding scheme where the students reside at the school during the week and return home on the weekends. The five-day boarding scheme costs

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Updated   May 26, 2016 |
Paying for Private School: 7 Options
Don't assume you cannot afford private school. Don't assume that you make too much money to be eligible for financial aid. Ask. Always ask.
I am always sad to hear parents rule out sending their children to private school because it is too expensive. The conversation usually begins with one of these facts as the reason for considering private school:
 
1. Their child is gifted.
2. Class sizes in the local public school are way too large.
3. Their child has a learning disability.
 
Any one of these reasons is a valid reason for considering private school. But, unfortunately, that is as far as considering a private school gets in most cases. Why? Because either the parents assume that they cannot afford private school or they looked at the page on a school's web site showing tuition and fees and panicked. 
 
Considering sending your child is a major decision. As with any major decision, it makes sense to do your due diligence before ruling anything out. When you take time to do a thorough investigation of the facts, as opposed to your assumptions, you just might be pleasantly surprised at what you discover. That applies equally to paying for private school.
 
Here then are six ways you can pay for a private school education. One just might prove to be the answer you are looking for.
 
1. Write a check.
 
Some people can afford to write a check for their children's private school tuition. If you are in a position in life where you can do this, don't forget to ask about a cash discount. Most schools will be thrilled to get their money up front. The usual practice is to
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Updated   January 16, 2018 |
5 Financial Aid Dos and Don'ts
Part of the private school selection process is financial aid. We point out five issues about which you should be aware.
DO Understand Why Some Private Schools Cost More Than Others
 
There are several factors which drive tuition costs. Location and facilities and type of school are three of the most important factors. Some schools cost more than others simply because of where they are located. Real estate prices vary widely throughout the United States as you well know. For example, it costs considerably less to rent space in Butte, Montana than in Los Angeles, California. 
 
Insurance costs vary from locality to locality as well. Schools need comprehensive liability and property insurance. That's not an expense a prudent private school business manager will stint on.
 
The school facilities vary widely as well. A 12 classroom K-6 school located in the 10 year old education wing of a church or temple will cost less to run than a similar school housed in a 1930s mansion set on 30 private acres in the countryside.
 
Boarding schools generally cost more to operate than day schools. That's because they offer 24/7 supervision of your child as opposed to the 8 or 9 hours daily supervision a day school will offer.
 
Schools specializing in remediating learning differences and disabilities cost even more because they employ experienced, highly skilled and trained para-professionals and professionals who work with students closely, often on an individual or 1 to 1 basis. That drives the labor cost associated with this kind of teaching much higher than when a teacher has a class of 12-15 students.
 
DONT Delay Finding Out About Financial Aid
 
Financial aid can be very confusing
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Updated   June 14, 2016 |
Comparing Tuition Costs By Location
Why does one private school cost less than another in the same area? Why are certain areas of the country much more expensive than others? We examine tuition costs around the nation.
You and I can understand the average cost of tuition of private schools as detailed on Private School Review by being aware of a couple of factors. We will take a look at those factors and also show you how the cost of a private K-12 education varies from region to region. That way, if you have to move from one location to another, you will have a general idea of what to expect as far as your private school expenses go.
 
We will begin with a look at how the cost of elementary schools compares with schools offering high school grades.
 
Costs subsidized by religious organizations
 
Let's examine one reason why average tuition costs can be less in one area than in another. That has to do with the number of religious schools included in the statistics. I am not being negative here. Just factual. Faith-based schools, be they Roman Catholic, Jewish or Christian or any other religion, tend to be subsidized by their religious organizations. For example, a temple which establishes an elementary school will do so to serve its congregation in the first instance and then as an outreach to the wider Jewish community in the second instance. The tuition generally will be discounted for families who are members of the temple. This practice is similar to how state universities charge less for students who are state residents as opposed to students who are from out of state.
 
Using existing facilities
 
The next factor to consider will be non-cash subsidies such
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