Three Financial Mistakes Parents Make During the New School Year, According to Financial Planner
As the new school year approaches, many parents feel pressured by the accumulation of educational bills. However, this financial strain is often caused not by high tuition fees, but by flawed planning patterns.
Financial planner and founder of DNA Finance Indonesia, Aliyah Natasya, revealed that this phenomenon recurs every year. Based on her experience handling hundreds of consultation sessions, Aliyah identified three main mistakes frequently made by parents in managing education finances.
The first and most concerning mistake is the use of emergency funds or taking out high-interest consumer debt to pay school fees. Aliyah emphasised that emergency funds serve a specific function as a family’s ‘last bastion’.
‘Emergency funds are not a bank. They are the family’s last line of defence for truly unexpected situations, such as job loss or illness,’ said Aliyah. According to her, education costs are expenses that can be anticipated well in advance, and therefore should not deplete emergency reserves.
The second mistake involves focusing only on primary costs, such as enrolment fees and monthly tuition, while overlooking ‘hidden costs’ that often escape calculation, thereby disrupting family cash flow when the school year begins.
The third mistake relates to psychological and social aspects: choosing a school based solely on aspirations or prestige without measuring long-term financial capacity. Aliyah observed many parents forcing themselves into schools that are ‘barely manageable’ financially, which poses a significant risk if there are changes in income in the future.
She advised parents to review their financial capacity for at least the next three years before deciding on a school. This is crucial because education costs are ongoing, rather than a one-time expense in the first year. ‘Do not buy a ticket that you cannot afford to pay for until the destination station. Once a child enters that school, it will be very difficult to withdraw halfway through,’ she concluded.