Question 1

How fast do education costs rise in India?

Accepted Answer

Education inflation in India has historically been 8-12% per year, significantly higher than general CPI inflation of 5-6%. A course that costs Rs 20L today could cost Rs 52-62L in 10 years at 10% education inflation.

Question 2

Should I use a lumpsum or SIP for education planning?

Accepted Answer

This depends on your current savings and income. If you have idle funds, a lumpsum invested today needs a smaller amount (compounded over the full period). If you are building savings over time, SIP is more practical. This calculator shows both options.

Question 3

Which mutual funds are good for children's education?

Accepted Answer

For a 10+ year horizon, diversified equity funds or balanced advantage funds work well. For 5-7 years, hybrid funds reduce volatility near the goal date. As the goal approaches (2-3 years away), gradually shift to debt funds to protect the corpus.

Question 4

What is the education inflation rate for abroad education?

Accepted Answer

Education costs for overseas universities (USA, UK, Canada, Australia) are subject to local inflation plus INR/USD exchange rate movement. A combined effective rate of 10-15% is realistic for planning purposes.

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