Parents with young children may feel like university or college is a long way off. In the daily battle to get the kids packed up and on the school bus, the idea of their future academic ambitions (and associated financial demands) can seem like a dot on the horizon.

But with fees at top US universities reaching as much as USD 50,000 (around RMB 305,000) a year, parents who delay or ignore the issue altogether do so at their own (and more crucially, their children’s) peril.

Higher Education Costs
If you are planning for your kids to study abroad, you may need to pay significantly higher fees than the country’s citizens. Even if you plan for your children to return to your home country, you cannot be certain that the costs you anticipate will remain the same.

Taking inflation into account, the price of education has proven fickle. In 2012 for instance, the maximum yearly tuition fees that British higher education institutions could charge domestic students jumped from GBP 3,290 (around RMB 33,000) to GDP 9,000 (around RMB 89,000) – an increase of 174 percent.

Next, factor in living costs (which may need to include rent in an expensive major city) and you may find yourself facing a huge yearly bill. In some countries, low-interest loans are available to students and plenty of institutions offer scholarships, but it is very difficult to know what assistance will be available to your child when it comes time to apply.

Put simply, enrolling your kids in university is an expensive endeavor and it is hard to predict how much you will need to put away. But despite these uncertainties, one thing is for sure: if you save too little or start too late, you risk having to compromise on the standard of the institution that you are able to afford.

When to Start and How Much to Save
There is no simple answer to the question of when to start saving, according to Mark Matlaszek, a senior financial advisor at BlueStar AMG, an asset management company catering to the expat market in Asia. While he sees plenty of families with young children looking to begin education planning, Matlaszek also encounters parents-to-be preparing for the future.

“It can be too late to start, but it’s never too early,” he says. “Let’s say you’ve got a child on the way and you’ve got to set aside USD 200,000 for their higher education [over]an 18- or 19-year window. To accumulate that sort of money [in]this timeframe is very affordable and very possible. If you have a shorter window then it becomes incredibly expensive and difficult.”

The next obvious question for parents is “How much do I need to save?” Again, there is no definitive answer and it will depend on what type of institution and course you are aiming for. Some may want more flexibility to cover the larger financial burden of top universities or programs like medicine and architecture. Each family’s circumstances will be different, but your financial planning will always revolve around three main factors – your existing assets, the income available for regular contributions, and the amount of time you have left before your child enters higher education.

Some parents may choose to manage their own savings, assets, and investments. This could be in the form of safe but low-yield options such as fixed-interest accounts, or other traditionally stable investments such as  property. Others look to higher-risk options such as the equity markets (stocks and shares).

Your ability to absorb potential losses is another crucial factor in decision-making. But this resilience to risk is likely to change over the course of the saving period. Choosing an investment or saving plan that allows you to adjust the level of exposure to risk can help maximize your returns while ensuring that your money remains relatively safe in the long term, suggests Matlaszek.

“If you have a [long]time frame, you should perhaps aim to be a little bit more risky in the early years – equity investments, for example. That means you have plenty of time for recovery and to take advantage of market volatility,” he advises. “As the years go by and you get closer to reaching your goal, you should be shifting to a much lower-risk portfolio because any gains that you’ve made or capital that you’ve accumulated need to be protected against negative market movements.”

Plans and Packages
For parents who do not know their bonds from their bear markets, fear not – many people turn to structured plans for long-term savings. Even those who are fluent in finance may benefit from the ease of a managed plan, as well as the ability to spread their risk more widely.

The type of arrangement that Matlaszek often recommends for education planning is fixed-term (in other words, designed to reach maturity when you need to access the money) and can be paid  on a monthly, quarterly, half-yearly, or yearly basis. Your money will be spread across funds that comprise a mixture of stocks, shares, bonds, commodities, and currencies. With the assistance of a financial advisor, you can vary the level of risk to suit your circumstances and be confident that someone is keeping a close eye on the markets where you keep your capital.

Many families also find that this type of structured plan helps them be disciplined when preparing for the future. This was the experience of UK-born Paula Zhou, head of schools at The Children’s House International Montessori Kindergarten. Along with her Chinese husband Weihua, she began saving for 8-year-old Eiriana and 3-year-old Liam at the beginning of 2012.

“Living in Beijing can often see life run away with us – exotic holidays and Michelin Star restaurants [are]all on our doorsteps,” she explains. “The salaries that we earn might seem reasonable, but without a scheduled, routine saving plan it was really difficult for us to ensure that we could continue having fun today and provide for our family tomorrow. Having this plan has really helped us feel a little more secure that there is something going toward our children’s future.”

The Zhou family now saves the equivalent of around RMB 7,000 a month, which goes into a fund earmarked for both the children’s education and the couple’s retirement. The investment has a forecasted yield of over 5 percent a year and is managed by an advisor, something that Zhou benefitted from after finding that “the technical jargon of financial planning [was the]greatest cure for insomnia.”
Regardless of your circumstances and needs, independent financial advice should be free and there is often no harm in consulting a professional to see how to make the most out of your current and potential wealth. The most important is to start thinking about the future as soon as possible. A small amount put aside today could go a long way towards securing the best education for your kids.

Editor’s note: Mark Matlaszek was interviewed by beijingkids to provide independent financial advice and this does not equate to an endorsement of the investment packages recommended by BlueStar AMG or any other asset management company. All investments carry a certain level of risk and you should first carefully consider your financial position and the potential losses you are able to absorb.

BlueStar AMG
BlueStar AMG is an asset management group operating across Asia and offering a range of savings, investment, and insurance. The company offers a free 45 minute consultation to discuss your needs. Citizens of mainland China are not permitted to transfer funds to overseas institutions so are normally ineligible for the company’s savings plans, although property investments are available to the domestic market.
16/F, Gemdale Plaza, Tower A, 91 Jianguo Lu, Chaoyang District (5920 8238 info@bluestar-amg.com) www.bluestar-amg.com

Top Universities
A website providing detailed information about world universities, including world rankings and up-to-date fee information. 
www.topuniversities.com

Find the downloadable 2014-2015 School Choice Guide here.

Photo by Ken

Finding the right school is often the top priority for families living in or relocating to Beijing. But education in the capital comes at a cost.

Many larger companies offer full school funding for employees’ children as part of their relocation packages, meaning that money is no barrier to the top international schools. But not all are so fortunate. Some may choose to simply pay the fees out-of-pocket, while others look to local schools, homeschooling, and different sources of financial assistance to mitigate the cost of education. We spoke with four families about their solutions to the school funding conundrum.

Homeschooling: The Ambrose Family

Yearly Spend
Art lessons- RMB 3, 000
Sports programs- RMB 4, 000
Chinese lessons- RMB 3, 000
Events at The Bookworm- RMB 1, 500
Books (first two semesters)- RMB 7, 300
Total: RMB 18,800 (excluding cost of miscellaneous equipment and Jennifer’s time)

Jennifer Ambrose relocated to China from the US in 2006. A columnist for beijingkids, she has two children with her husband Randy: 10-year-old Myles and 5-year-old Brigid. She homeschools both of her children at the family home in Changping outside North Sixth Ring Road.

Why did you decide to homeschool your children?
I was always curious about homeschooling, mostly because I have quite a few friends that homeschooled in the US. I didn’t think we would actually do it ourselves but my husband’s compensation package [did not]include school tuition. That’s when I stopped just toying with the idea and [started]considering it more seriously.

There’s often a feeling of being on a learning adventure together. Sometimes, all it takes is the three of us gathered around a book, learning some weird and wonderful fact about dinosaurs, or one of the kids to ask a simple question, and we all fall into the rabbit hole as we pursue the answer.

Was the cost of the alternatives a factor in your decision?
Cost was definitely a factor, but also the flexibility of schedule. Currently, my husband’s job requires him to visit other cities in China [as well as]the US and Europe. Since we aren’t tied to a school calendar of testing and holidays, the kids and I often travel with him. It’s an opportunity we have to take advantage of while we can.

Were the costs as expected and do you have any financial tips for families considering homeschooling?
I was prepared for the books and supplies cost but families that aren’t able to make trips to their home countries to bring back books may need to consider the cost of shipping. For [anyone]wary of the expense of outside teachers, it is possible to work out arrangements with other parents to exchange talents. Right now I do this with a Chinese family in Changping. I tutor their son in English, and his mom spends that time playing with Brigid in Chinese.

How else do you share resources with other parents in the same situation?
Art is a subject that I have no idea how to teach or even guide. We’ve been lucky to be able to join up with other homeschooling families to share art teachers and we rely on Sports Beijing for our physical education. Myles plays baseball and Brigid plays soccer right now. The kids have their [training]and matches on the weekends, so during the week the kids are motivated to practice on their own at the park.

Additional Fees Explained (Well, Sort Of)
When choosing a school and planning for the academic years ahead, it is important to take into account all of the various fees that you may encounter. Schools may be relatively upfront about their fees, but there are often a number of hidden (or at least not well-publicized) charges. Here are some of the most common ones to keep in mind.

• Lunch fees. These can vary from RMB 15-50 per day and may be paid for monthly, yearly, or through a top-up card system.
• Bus/transportation fee. Anywhere from RMB 3,000-13,000 per year depending on the school and the distance required. Some schools charge this monthly.
  
• Application/new student fee. Normally between RMB 1,000 and 2,000 for international schools.
• Deposit. Can be as high as RMB 20,000 and some schools require the same amount again at the beginning of each year.
• Uniform fee. Can vary from approximately RMB 500 to 3,000 per year. Students can usually re-use them from year to year as long as they still fit and are in good condition.
• Donation fee (zanzhu fei). A phenomenon found in local schools where access to the most popular institutions is secured with a “donation.” Reportedly as high as RMB 30,000.
• Zafei. To complicate matters further, many of the above charges are rolled into the all-encompassing zafei (“miscellaneous fees”), especially at local schools. This ambiguous term seems to differ in definition (and price) between every school that charges it and may, or may not, include electricity/water fees (shuidian fei, 彊든롤) and textbook fees (shufei, 蝎롤)
• Capital levy fee. In the context of international schools, this fee normally applies to money used towards buildings, facilities, and facilities. Schools differ in their definitions, though it is usually in the region of RMB 10,000-20,000 a year.

When beijingkids spoke to Ma Fei, a lawyer specializing in education, he had a very different definition of the capital levy fee, describing it as an optional fee for primary or middle school students either (a) choosing a school in a different district than where they live or (b) who do not have high enough grades.

The moral of the story is this: Ask the schools you’re interested in to provide a full list of fees. We try to ensure that the schools featured in the listings pages of this guide provide a comprehensive overview of their charges, but there are not always set definitions of what many of the fees really cover. Each school configures their fees differently, so we advise you to be thorough in your research and assertive in trying to figure out just what you need to pay – and what you don’t.

Find the downloadable 2014-2015 School Choice Guide here.

Photo by Mitchell Pe Masilun

Finding the right school is often the top priority for families living in or relocating to Beijing. But education in the capital comes at a cost.

Many larger companies offer full school funding for employees’ children as part of their relocation packages, meaning that money is no barrier to the top international schools. But not all are so fortunate. Some may choose to simply pay the fees out-of-pocket, while others look to local schools, homeschooling, and different sources of financial assistance to mitigate the cost of education. We spoke with four families about their solutions to the school funding conundrum.

Self-Funded: The Foster Family

Yearly Spend
Tuition- RMB 136, 680
Lunch- RMB 6,000
Yearly deposit- RMB 5, 000
School trips- RMB 200
Texbooks- RMB 60
Total: RMB 147,940 (Placement fee paid in first year)

Jody and Scott Foster from Australia have lived in Beijing for two and a half years with their daughters, 4-year-old Macy and 8-month-old Keira. Jody volunteers at the International Newcomers’ Network and the Australian and New Zealand Association (ANZA) of Beijing, while Scott works for a mining and engineering company. Although Scott’s expat package provides education for school-age children, it does not cover kindergarten. Until then, the family is independently funding their eldest daughter’s education at House of Knowledge International Kindergarten.

What has led you to self-funding Macy’s education?
When we first moved to Beijing we were looking for something similar to what we had in Australia – one or two days a week [at kindergarten]– but there weren’t that many schools offering this kind of schedule. Our other option was to get an ayi and not send her to school until she was older, but all of the additional costs, like art classes, were very expensive. After her first school year, she moved up a class she could only do full time. We asked [Scott’s] company for assistance but they only offered a small amount so we could either pull her out of the school or fork out. We decided to keep going because she really enjoyed it there.

Did you consider sending her to local school?
No. Initially we were only planning to be here for 12 months, so at the time cultural immersion in Chinese was not a priority.

Were you surprised by how expensive international education is in Beijing?
Yes it’s ridiculous – mind-blowing. I was posting on Facebook telling everyone how expensive [education is]here. The amount that you would normally spend on a high school education in Australia is what you need for a 2-year-old here. But it’s an excellent school; we’ve been fortunate enough to always have good teachers and the curriculum is well-established.

Have you had to make sacrifices to be able to pay for fees?
Thanks to our package we do not have to pay for other things like rent. In that sense it hasn’t impacted on our lifestyle – what comes out of one hand now comes in by another. We also have rent coming in from our place back home, but we have lost a substantial amount of our savings that we would have put towards renovating our home in Australia. So inadvertently we have made a sacrifice.

What are you plans for Keira’s education when she’s older?
We’re actually relocating to Nanjing. But hypothetically, we wouldn’t do the same for our youngest daughter because we have an ayi now. The culture in Beijing is to send kids [to school]full-time from a very young age, which is very different from Australia. There are far fewer [schooling]options in Nanjing and it’s even more expensive there.”

Find the downloadable 2014-2015 School Choice Guide here.

Photo by Mitchell Pe Masilun

Finding the right school is often the top priority for families living in or relocating to Beijing. But education in the capital comes at a cost.

Many larger companies offer full school funding for employees’ children as part of their relocation packages, meaning that money is no barrier to the top international schools. But not all are so fortunate. Some may choose to simply pay the fees out-of-pocket, while others look to local schools, homeschooling, and different sources of financial assistance to mitigate the cost of education. We spoke with four families about their solutions to the school funding conundrum.

Local School and Expat Package: The Nair-Harikishan Family

Yearly Spend (in RMB) for Peiji Bilingual
Tuition- RMB 54, 000
Lunch- RMB 4, 800
Bus- RMB 7, 200
Application fee- RMB 1, 600
Insurance fee- RMB 50
Late pickup (for working parents)- RMB 4, 800
Total: RMB 72,450

Yearly Spend (in RMB) for BSB Sanlitun)
Uniform
Lunch
Total: RMB 8,200 
(Full school fees and trips 
covered by expat package. 
Application fee and security deposit paid in previous years)

Rohini Nair and her husband Harikishan Narayanan both hail from India and moved to Beijing three years ago. While the family’s expat package covers the cost of 7-year-old Manu’s education at the British School of Beijing (BSB) in Sanlitun, 2-year-old Aryan is still too young to qualify, so he currently attends a local Chinese kindergarten, Peiji Billingual.

Why did you choose to send your youngest son to a local kindergarten?
[My husband’s company] will only cover the child’s education from the age of 5 but I wasn’t happy with my son spending so much of his time just with the ayi. He didn’t have that many friends in our compound to play with, so now he gets the chance to interact with other children – that’s my only expectation of the school.

How has your experience of the kindergarten been?
I’ve been impressed by the food, which is cooked at the school and catered for the children. It doesn’t have any stuff like fries and burgers and it’s very healthy. Secondly, they have CCTV set up, so any time I walk into the waiting area I can see what he’s up to. They also have a password they give to parents so you can log in and see what’s happening in class. I can see he’s picked up a lot and I’m quite happy with the school.

Were you surprised by the fees for local kindergarten in Beijing?
We moved from Zurich, where we paid quite a lot for kindergarten. But compared with a country like India, [Beijing is] way higher. [Our son is] making progress in Chinese and English and for a bilingual school with good standards, I don’t think [the fees]are too high.

Your eldest son goes to BSB Sanlitun on your husband’s expat package. How have you found the school?
It’s a small school and I thought a smaller campus would be better for a younger child rather than being intimidated by a big one out in Shunyi. It’s very close to where we live and we weren’t interested in moving further out. I’m happy with BSB – it’s a very good school and if we’re still here when my [youngest son]is 4 then he will also go to the same school.

Would you be been able to afford to send both kids to international school were it not for the financial assistance?
No, we wouldn’t be able to pay for both children. It is also a question of whether we want to. If we were going to pay for a bachelor’s degree, say for four years, then that’s the same amount I would spend on education at an international school. It could cover the cost of a Bachelor’s or Master’s degree at one of the most reputable universities in the world. I don’t think a good education is necessarily [based on]how much you pay for it.

Find the downloadable 2014-2015 School Choice Guide here.

Photo by Mitchell Pe Masilun

Finding the right school is often the top priority for families living in or relocating to Beijing. But education in the capital comes at a cost.

Many larger companies offer full school funding for employees’ children as part of their relocation packages, meaning that money is no barrier to the top international schools. But not all are so fortunate. Some may choose to simply pay the fees out-of-pocket, while others look to local schools, homeschooling, and different sources of financial assistance to mitigate the cost of education. We spoke with four families about their solutions to the school funding conundrum.

Scholarship: The Lay-Him Family

Yearly Spend (in RMB)

• Tuition
• Bus
• Uniform

Total: RMB 101,800

US-born Christopher Lay has lived in Beijing for five years, where he works as a photographer, writer, and beijingkids columnist. He lives in Wangjing with his wife Savvy Him (a full-time working mom), their 6-year-old daughter Reina, and toddler twins Bryson and Ryder (age 1). Reina started attending Daystar Academy after receiving a scholarship.

What is the nature of the scholarship?
Reina was awarded a scholarship to attend Daystar Academy by the board of directors. It was based on how well Reina [and our]family were a good fit for the school and our need [for]financial support. The scholarship covered the entrance and lunch fees and reduced the tuition to a level that we could manage. There are only a limited number of scholarships awarded each year and we felt very fortunate to receive one.

How was the scholarship assessed and awarded?
Upon enrolling at Daystar, all applicants receive an assessment from an English and Chinese teacher. The school also reviewed Reina’s records from kindergarten. In addition, the board also needed our financial records. I believe that, because Reina was already fluent in both languages (she previously attended a local kindergarten) and understands both Western and Chinese cultural differences, she was an ideal candidate for the school.

How much help has it been financially for you?
The scholarship made all the difference on our school choice for Reina. She really wanted a bilingual educational experience, but without the assistance from the board, Reina would be attending a local school here in Wangjing.

Did you look at scholarships from other schools?
We did not apply to other schools since most are much more expensive than Daystar and few have a similar bilingual approach. [The school] always felt like the best fit for our family. Our backup was the Wangjing Experimental School as it is close to home, but honestly, we were all in on Daystar.

You have 1-year-old twins. What are your plans for financing their education?
Sell one to pay for the other’s education? That is an excellent question that remains to be answered. We considered homeschooling Reina in the past, but it never felt like a good fit for her. With twin boys, homeschooling might be a viable option. Unless our finances change dramatically, there is no way we can afford international school prices for three children in Beijing. Beyond kindergarten, Beijing may not be viable unless we homeschool or the boys go to a local school.

Find the downloadable 2014-2015 School Choice Guide here.

Photo by Ken