Paying for private school

Tips and tricks for sending your child to private school

Category: How to pay for it (page 1 of 5)

Free installation with any purchase!

We recently purchased a super fancy set of revolutionary Nest Protect smoke and carbon monoxide detector. These things talk to each other and alert us to the specific location of the room the problem is occurring in. Fantastic!

Nest Protect Advanced Wireless Smoke Detector Available on Amazon.

Nest Protect Advanced Wireless Smoke Detector Available on Amazon.

We replaced the existing 30 year old hard wired smoke detector alarms with the Nest Protects. These things will even contact you phone if something happens. I got an email from the first one when I shut down the power for the second installation. Well done Nest team! It is not clear are old ones would have even gone off (when removing them the tag noted they expired in 2003) in a fire situation. Will yours?

Do  it yourself to save money

This amazing technology combination is available for only $99 each. And an installer can be hired to connected wired ones for $80. We opted to pass on that and to save the money and the hassle (for all involved) of taking a day to have someone out. The first one took me about three hours of watching videos and carefully proceeding (mostly issues with removing the old one). The last one I installed took less than thirty minutes from opening the package to the final test.

Take your time

If conditions make sense, do the installation yourself. Watch the videos (as many times as you need). Follow all instructions and expect to run into snags that will require more research and take additional time. This isn’t a race and you aren’t being graded on efficiency.  If you are like us you will find the experience saves money which can be used for private school tuition and is more rewarding  than taking off work for an installer to arrive.

A tale of two colleges

A hard working young family member recently went off to college. Before doing so there was a choice to make. Should they go to the fancy college and stack up $300,000 in student loans. Or go another, excellent school – but with a less known name – and get a decent education  free and clear of debt?

They chose the lower cost school thus proving they were qualified for either place.

How wise were they?

Assuming a $300,000 loan and using this helpful loan estimator calculator and the lower end of current rates (5%) for student loans after graduation the monthly re-payment would $1980 a month.  For 20 years. Yikes. Hope  students at the fancy school really like the job they get as they will need to work at it for a really long time. That payment schedule is the original $300,000 paid back plus and additional $175,000.

So they saved a lot of future hassle by avoiding the massive loan to fill their head with fancy thoughts. So very wise!

But wait, there is more!

As a thought exercise lets pretend that upon graduation that same amount is contributed to a retirement account instead of repaying a loan. How would they be doing after 20 years?

According to this investment return calculator  the same $300,000 plus $175,000 is dumped in an account over 20 years. That is $475,000 in contributions. And that yields $328,000 in interest over the two post school decades. So by avoiding the large loan and investing the difference this student would end up with $803,492.

Want to be a millionaire? It’s easy.  Pretend like you took out a huge student loan and go to a lower cost college instead. Invest the different and then decide if you still want to keep working or retire at a fairly early age.

The actual decision

It is easy to imagine stacks of cash with some high paying job from the prestigious university. Well, if it works out. What is easy to forget about really large student loans is that they are loans and must be paid back. * And that money means other options (a car, a house, medical expenses investment) are already spoken for right out of the gate. And you might change your mind next year. Or ten year from now.

So the decision is not “should I take out a $300,000” loan. The decision is actually “Is this school’s tuition worth $803,492 and much of my future income”?

 

* The idea of planning on loan forgivness or defaulting on it, means a contract signed with no intention to pay it back. Maybe that appears clever. Another more way to look at it as proof that one either does not make and keep promises, lies or took extra risk  (or all three). Doesn’t seem worth trading one’s options and good will for bunch of lectures you can get at other places.

Use the innovation cycle to save stacks of cash

Life 100 years ago 

One hundred years ago most people worked 60 hours a week and there was one car for every 50 people.  And  then they came home to dark homes – many did not have electricity. And the first appliance just turned a hundred a few years ago.

There has been remarkable advancements in the past 100 years and you can use that to your advantage to save stacks of cash.

Freeze your standard of living

To save money with no effort, simply freeze your standard of living in time. Do you want a stainless steel fridge? Forget it – no one even had a refrigerator 100 years ago. Even better, the modern marvel of 50 years ago is now the economy version of today so your replacement cost is lower each time you need to replace an item.

Need that latest turbo, all wheel drive, leather interior badged car? No you don’t! You will be just fine with an economy car and still be better off than 49 out of 50 people 100 years ago.

So Many Horses!

Did you know the model T ford generated 20 horse power?

What amazing technology! 20 horses in one device! Wow!!!

The 2018 Ford Focus generates 160 horsepower and made the list of lowest cost cars! That is 8 times the power of the model T and 160 horses!  That is plenty of zoom and more power than most farmers had 100 years ago.  And it the Ford Focus of HorsePower Awesomeness can be owned new for a about $18000. And, amazingly, this is  still costs less than the slower (inflation adjusted) Model T Ford price of $22,000. And you can often (but not always) save more money purchasing a used car!

Public Domain, Link

The idea here to freeze your standard of living where it’s  at now. No upgrades, just replacement items.  You will be just fine keeping the things the same. You know this because you live exactly that way right now!

Add Even More Horsepower

 

In a pickle and want to save more money? Work 55 hours a week. 50 at work and  doing your own chores around the house you currently outsource.  You will save money and might get a raise.

By attempting to match your grandparents work ethic and freezing your standard of living your cash flow will almost immediately turn positive.  I look forward to seeing you soon in the private school parking lot  in your amazing  horseless carriage. Zoom zoom.

 

One day only special! Half-priced cars!

Want a tip for buying a great car at a discount?

Go contrarian – buy out of style cars

Here is what we did;  we purchased an older car but with relatively few miles for it’s age but was out of favor at the time we purchased it.

This has varied over time depending on the circumstances which makes our car history quite varied and has almost always caused raised eye brows on our choice (we take that as a good sign).

At the time we purchased our last car, during a late stage bull market,  luxury cars buyers certainly did not want an out of style luxury car that someone else drove in. The perception of “luxury” typically doesn’t pair well with “used”.

And economy buyers wanted the used cars rated highest for reliability.

This left few buyers in the used luxury cars market segment. And we really value safety features so  we watched the market for a really safe used luxury(ish) car.

And those conditions means we were able to get our current rig at a much lower cost than one would expect.

Behold the Battle Wagon

Our current rig in all it’s glory:

Volvo Wagon - New to us!

Volvo Wagon – New to us!

Swedish steel! Best in class safety. Row boat like styling. Squishy seats. Impossibly thick paint. Odd brown stains on the ceiling of questionable provenance. Vintage!! Did you know they don’t even make this model any more? It’s true! And butt warmers!

Buy older cars with low miles to get lots of trouble free service

The Battle Wagon was ten years old with only 75K on the odometer when we purchased it. Net, we bought this unloved ride for 80% off the original sale price. It was fairly low cost. Indeed, once we sold the our previous battle wagonette and accounted for the ten years without cable savings the car was effectively  free with years of pre-paid gas included. A brand new car would have absorbed all those savings and I would have been worried about scratching the fancy doors.

Right now electric cars are out of favor because of low gas prices

Right now non-Tesla electric cars are out a vogue and can be purchased for a song. With low gas prices they are really out of fashion. You can get one for a fraction of the cost of similar vehicles. Well, that is until gas prices go back up.

Want to be an environmentalist? Get a used electric car and reduce fossil fuel emissions *and* save a perfectly good car from going to the scrap heap. You are *so* green. More of a  outdoors person? Wait until gas prices go back up to the $4 and $5 a gallon price range and get one of those gigantic pick-em-up-truck for half price.

Please check the safety rating on the model year and proceed!

The true cost of watching a movie

What is the actual price of a movie? Consider these four costs before  you decide to hit  “play”.

 

Watching a movie has four major components. These are the fixed  cost,  the one time cost, the opportunity cost and the second order effect costs.  Let’s briefly visit each.  You of course cut cable a long time ago – or you are about to do that so lets use the streaming services as our example. 

Fixed Cost

Netflix offers a standard plan for $10.99 a month ,

Lets say you watch one show and three movies in an average month. That is $2.75 per show.

One Time Cost

By MrexcelOwn work, CC BY-SA 4.0, Link

And Amazon Prime offers lots of movies for a low a $2.99 each and sometimes over $10 but you are frugal so the one time cost in this example is about the same as Netflix.

Either way each movie you watch is around $3 bucks. And before you binge a show to get that cost per movie down lets consider the opportunity costs.

Opportunity Cost

More pressing than the movie cost is the opportunity cost of watching the big screen for two hours. For example, yesterday, we changed the headlamp bulbs in our car. This cost $30 in parts but according to online quotes  the service price is between between $100 and $214. I am not clear if that is per bulb or for both but lets assume it’s $150 to replace both bulbs, parts and labor. We saved $130 bucks on that expense in 20 minutes, got to chat while doing so and didn’t have to take off work to take the car to the shop.

Too tired for such efforts? No problem ! Spend 20 minutes praying or meditation. This is a bit lower energy and has numerous benefits.

In both examples you still have lots of left over time to wander around the house (more health benefits).

The Second Order Costs

 

The second order effects are the most expensive. Many movies are action packed thrillers which can use a lot of your emotional energy up. These dynamic natural scenes impact your brain chemistry

and in extremes might reduce both the quality and length of your life.  It’s fun stuff but for the most intense movies you might need a mental break afterwards and changing the bulbs after a movie might be too much – anyway you have so little time after using two hours of to someone else’s script. This time compression is the worst offender and might end up with a dinner out ($40) since there is no time or energy to cook. Plus the world just blew up on the big screen so what’s the big deal with ordering delivery?

 

The True Cost

Lets compare the numbers!

 

The movie abstainers saved $130 bucks and the movie watchers spent $3 on the movie and $40 on take out. That puts the active family ahead by $173 dollars *and* they have a free hour to themselves. Time and money in abundance.

 

The Take Away

I am not against movies –  and they can be made into wonderful family events or a mental break if you are feeling ill. With that said if you work hard during the week to pay for tuition it seems a shame to not know  the full price you are going to pay before you hit play as something to do.

 

“Time is your most important resource. You can do so much in ten minutes. Ten minutes; once gone is gone for good.”

– Ingvar Kamprad (IKEA Founder)

Skip the Tip! Take it to go and eat at home.

This took me many years to discover but it has served us well. Despite being on the frugal track we occasionally eat out (ok, more than occasionally). Sometime as a family sit down dinner or for a special occasion but most often because we go out because it would be fun to go out.

To save 15% at a restaurant, skip the tip by taking the food to go. That will save 15% (or 20%) on the bill because there is no tip. And, after a while, you realize you have drinks at home. And bread. And that is another few dollars saved.

Electrical candlelight!

Instead, set your home up to be a delightful place to eat with a fancy and clutter free table that include  forks that haven’t been in a million people’s mouths (a no cost bonus!). At the Café De Your Place there is never ever a wait. The table is always open, there are just enough seats and it’s the best table in the joint.

Plein Air!

In the summer we eat out on the ‘rustic’ wood table that came with the house. This year we added a coral maple to enhance the view at our fine dining establishment. How many restaurants do you visit have this kind of greenery? Get creative (but low cost) and set up your own ambiance.

G Ruga Coral Maple Tree Photo

Paying for Private School’s  Frizzy Coral Maple Tree of Awesomeness.

If you are like most families where eating out just overtook the grocery sales then you probably spend around $2625 on dining out.

Ha. I know the truth.  If you have the income to consider a private school tuition and live in metropolitan area that number is much higher. It is more like $6000 a year. Lets go with $6000. That is $900 a year in tips if frequent wait in line and then sit down establishments. Toss in another $100 on desserts and drinks over the course of a year and we will make it an even $1000.

Show em’ the sink!

I know some of you are secretly cringing because you spent way more than three or even six thousand on dining out last year. This is a judgement free zone. We are here to help. You just have more opportunity to save! Start with an immediate 15% discount on many (and soon to be rapidly declining) restaurant meals. And enjoy the further benefit from having your children rarely hearing  the phrase “I will be your server for this evening”. They need the gift of responsibility and can get up and get their own water when they need a refill.

This one slight change in behavior nets you $1000 a year and comes with a free side of humility for the entire family. A $1000 here and  there starts to look like a tuition payment and there are lots of easy ways to save big money.

Paying for Private School French Country Kitchen

Paying for Private School French Simulated Country Kitchen- comes with reading materials. How many restaurants do that? Don’t worry, we bought those chairs used.

Did you know you can get paid $5000 for wearing a pair of sandals?

Your feet are powerful tools of awesomeness.  Many folks know that walking and biking are ways to save stacks of cash.  There is a second foot power that is equally as impressive.

Unleash the Feet

Did you know the human foot has over 125,000 sweat glands? This is the highest concentration anywhere on your body. This is often described as a defect or problem. You dear reader are frugal and efficient so you already know why they are there- it’s the only part of the body that moves in a hot sunny day or inside a hot home with no breeze at all. Your do-it-yourself movement creates the  do-it-yourself cooling breeze.

feet in sandals to pay for private school

Sandals

Of course this is because the foot is mean to be bare and out there. And a great way to stay cool in summer is to get a pair of sandals and wear them around all the time. By doing so ourselves we found (after a two week adjustment period) we were just as comfortable with the air conditioning set at 82 (27 Celsius) degrees as we were with shoes on at 72 degrees (22 Celsius).

Apply Your New Found Super Power

One can save 3% on your AC bill for each degree you crank it up. That is 30% savings on your bill in the summer months! We have found it’s better – the AC didn’t turn on at all – often for an entire week with our newly discovered foot cooling super power.

In Santa Clara this is about $500 bucks over the course of the summer. Think you can make a set of sandals for the family last ten years? Good. It will net you in $5000 in actual savings. And this will be about $7500 in income you won’t have to earn over that time.

The Trick

For this to work there is a trick that took as while to figure out. And this is to wear sandals outside all the time. If you don’t your closed shoes will be puddles of discomfort and your core body temperature will rise. And tossing the shoes off at the end of the day in a fairly warm house is of little relief as it is too late. The trick is to stay cool *all* day by using your super powerful and amazing feet and then rake in the savings.

$200 bucks in sandals yields $5000 in ten years that can go towards tuition. That is 25 fold return on investment or an annual return of 90%. Try to do that in the stock market!

Bonus

As an added bonus you sandaled feet will now take you, in comfort, to other locations. You can turn off the AC and not start the car. You can walk to these things! And while Tesla’s are great, a pair of strap on sandals can make you an instant environmentalist with little upfront investment and increase your health as you work your system. Go you hippie!

And this is not new technology. For further reading check out the 22 verses about sandals in the good book.

And for next winter? No problem – just put an UGG on it!

Install a Power Plant

Did you own a home and regularly mulch flower and tree beds? Five hundred square feet in mulch will cost over $500 installed (apartment dwellers have wisely skipped this expense). Over ten years that is $5000! Of course you would do that yourself. Still, it is a lot of money. And you could do all that stuff. *Or* you can install a power plant one time.

Behold the powerful and lovely pachysandra plant.  In the first year after planting it sleeps, the second year it creeps and by the third year it leaps.

 

It grows in value

A small tray of this  green ground cover will run you about $20 at a landscape store. And that is all you need to start.

We bought ours of someone who had a big  patch of it for $4. We got it in wet newspaper and promptly planted  just a few stems in various places. I have been transplanting seedlings ever since slowly filling in the beds. Each year I have needed less and less mulch as this plant serves as a living mulch. And each spring  we enjoy lovely white flowers and fresh air produced by the plants. And last year a frog moved into to the shady refuge these plants provide.

And unlike mulch which is a drain on the budget, a pachysandra plant is a flowering ground cover that produces more value each year. We now have thousands of these plants worth thousands of dollars.

Many options

And if you don’t like this particular plant no problem – there are lots of ground covers to choose from that spread on their own.  English Ivy and Vinca are good choices but require a bit of care. Once those are in add some flowers and enjoy the beautiful savings

It’s easy being green.

Think multi-purpose

Ever noticed all those low profile and uninteresting hatchbacks, mini-vans and station wagons wheeling around?

Time to get excited about them because they are awesome.

We purchased our battle wagon for a net of $8000 even though it only has $70K miles and gobs of air bags.

Last month we needed a new side board (well, a side board, we never owned one).

New side boards were $1000 for low end ones unless you go with those glue and saw dust ones that have to be replaced soon anyway.

Too much! Guess those boxes stay on the floor.

We looked on Craigslist for weeks. And weeks. Even the cruddy stuff at low end stores was $500. Sigh. We were very close to dishing the money out for a new piece and cutting in other areas to make it work.

But wait, Craigslist has a 5 foot solid wood one for sale that on the Havertys awesome web site sells for $1000 new (love their stuff – so cool). And it is only $200 bucks and within a few miles of the house!

If only we had something to move it with – I am too lazy to rent something and it would take too much time. It might be gone and what if I don’t like it when I see it. In comes the incredible station wagon with seats that fold down! volvo-wagon-blueAn hour later the sideboard was now gracing our home instead of headed to the trash heap.  Money saving environmentalism.

On the way home I couldn’t help but realize the $800 saved was the equivalent of a 10% yield pay out on the wagon. That is pretty sweet contribution to the tuition.

Keep costs low and think multi-purpose.

That is One Long Cable!

Eleven years ago we moved into our current home. And the previous owners had not installed cable television. To get it installed meant an all day visit and lots of holes would have to be drilled into the relatively intact walls. And then we would have a $100 a month bill.

We put it off. Then we thought about it. And then we passed on it and just used Netflix and then eventually Amazon Prime for videos and a fancy “digital” antenna for local television stations.

In the first year we spent $1200 less than we would have otherwise. Importantly, we missed all those advertisements that likely would have increased our spending even more. Ten years later we had avoided $12,000 in costs.

Last year we got a sweet deal on a used Volvo XC70. Originally $45,000 when it was new, we picked it up used for $12,000. After selling the previous car for $4000 the net cost was $8000.

Volvo Wagon - New to us!

Battle Wagon – New to us!

By skipping on the cable expense for the decade prior we essentially got a free car with all the gas it will need for many years paid for up front. And that is good because we need to pay the tuition bills.

Limit those little expenses. They add up quickly.

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