Private School vs Public School: What's the Right Financial Decision for Your Family?

With private school costs averaging $16,000-$42,000 annually (and some reaching $98,000), parents face a crucial question: Is private education worth the financial sacrifice, or could that money build more value elsewhere?

Every parent wants what's best for their kids. You want to give them every advantage possible to set them up for success in life. But when you're staring at private school tuition bills that could rival a mortgage payment, the question becomes: Are you buying your child a better future, or just an expensive experience?

This dilemma comes up constantly with clients at Fox Hill Wealth Management. In a recent episode of their "Wealth Wisdom" podcast, the team dove deep into the private versus public school debate, armed with data that might surprise you—and challenge some assumptions you might have about educational investment.

The Sticker Shock: What Private School Actually Costs

Let's start with the numbers, because they're genuinely eye-opening:

Average Annual Private High School Costs:

• Least expensive state (South Dakota): $6,000/year

• Most expensive state (Connecticut): $42,000/year

• Massachusetts average: $38,000/year

• Rhode Island average: $30,000/year

But those are just averages. The reality can be much more extreme.

"In Manhattan, this is according to Spears Magazine—$98,000 a year boarding school," notes Justin from the podcast.

"What's particularly interesting: they welcome kids starting at 12 months of age. That's 18 years... about $1.8 million."

And that's before considering the time value of money. When you factor in what that money could have earned if invested instead, you're looking at closer to $4 million in opportunity cost over 18 years.

What the Data Actually Says About Educational Outcomes

Here's where things get interesting—and maybe a little uncomfortable if you're already paying private school tuition.

The Research Reality:

• When researchers control for family income, test scores are remarkably similar between private and public schools

• Rich kids tend to perform well regardless of school type, largely due to resources and support at home

• There's no consistent evidence that private school leads to higher lifetime earnings once you adjust for family background

"A 2018 study from the Urban Institute found that private high school attendance alone did not significantly affect college enrollment or later earnings after adjusting for student background," Eric Benz explains in the podcast.

Translation: The kid who works hard and has involved parents will likely succeed whether they're at the local public school or the $50,000-per-year academy down the road.

Where Private Schools Might Actually Make a Difference

Before you cancel that tuition check, there are some legitimate advantages to consider:

1. The Network Effect

Some elite private schools do provide networking advantages, but this mainly applies to truly high-end institutions where your child will rub shoulders with the children of influential families.

2. College Guidance Systems

Better private schools often have superior college counseling, with:

• More college representatives visiting campus

• Better guidance counselor-to-student ratios

• Established relationships with admissions offices

• More sophisticated essay coaching

3. Class Size and Individual Attention

Smaller student-to-teacher ratios (often 10:1 or 14:1) can benefit kids who:

• Get lost in larger groups

• Are hesitant to ask questions in bigger classes

• Need more individualized attention

The Smart Money Alternatives

If you're not convinced private school is worth the premium, here are some strategic alternatives that might deliver better value:

The Premium Public School Strategy

"Maybe you'd suggest going to a town with a really nice public school system," suggests Benz. "Some of those basically act like private schools."

He gives a specific example: "The town I'd like to move to in Rhode Island—their public high school has a student-to-teacher ratio of 14:1. They have an eSports team, gymnastics, random sports my high school didn't offer. This is a public school acting like a private school."

The Tutoring Investment

Bill Ryan offers another perspective: "You'd be better off getting a tutor for a fraction of the cost of private school. You could get them help in a couple of different subjects for less than six grand a year, which is nothing compared to these numbers."

The math: $6,000 for targeted tutoring vs. $38,000 for private school in Massachusetts. That's $32,000 you could invest annually for your child's future.

The Homeschool Movement

Homeschooling is growing 2-8% annually as parents seek more control over their children's education. It's often community-driven now, with parents rotating teaching responsibilities or specializing in different subjects.

The Real Financial Impact: What Else Could You Do?

Let's run some numbers that might make you reconsider that private school decision:

Scenario: $200,000 over four years of high school

If you invested that money instead at a 7% annual return:

• After 10 years: ~$393,000

• After 20 years: ~$773,000

• At retirement (30 years): ~$1.5 million

"You can take that $200,000 to send your kid to public high school and actually be set for retirement in 10 years," Benz points out.

The Personal Experience: A Reality Check

Eric Benz offers a personal perspective as someone who attended elite private schools:

"I was definitely a small fish—probably bottom 50% academically. When I got to college, I found it to be a breeze and was in like the 20th percentile. So there was an advantage in preparation."

But here's the kicker: "You'd ask my dad, and with a lot of siblings, he'd say 'I wish I hadn't done the private school thing.' We lived in a very nice town with a really good public school, and it cost him millions of dollars."

The lesson? Even families who can afford private education sometimes question whether it was worth the cost.

When Private School Might Make Financial Sense

There are scenarios where private education could be a reasonable investment:

Consider a private school if:

• You're in an area with genuinely poor public schools

• Your child has specific learning needs that aren't being met

• The networking opportunities are genuinely valuable for your family's goals

• You can afford it without sacrificing retirement savings or emergency funds

• Your child thrives in smaller, more structured environments

Skip private school if:

• You live in an area with excellent public schools

• The cost would stress your family's finances

• You'd have to sacrifice other financial goals

• Your child is self-motivated and does well in any environment

The Bottom Line: What Really Matters

The podcast team keeps coming back to one central point: parental involvement trumps almost everything else.

"Nothing replaces hard work," Ryan emphasizes. "Make sure your kid's a hard worker and they'll probably do fine no matter what you do. If they have a good work ethic that you've instilled from a young age, I think that's the most important lesson you can teach. Bar none."

The data backs this up: What happens at home—parental involvement, expectations, support—has a bigger impact on educational outcomes than the school building your child walks into each day.

Smart Strategies for Any School Choice

Regardless of which path you choose, here are strategies that maximize your child's educational investment:

1. Stay actively involved in your child's education

2. Supplement with targeted tutoring if needed

3. Take advantage of extracurricular opportunities at any school

4. Focus on developing work ethic and learning skills over prestigious credentials

5. Invest the money you save (if you choose public school) for your child's future

   
   

The Real Question: What Are You Actually Buying?

Before writing that tuition check, ask yourself honestly: Are you buying better educational outcomes for your child, or are you buying peace of mind for yourself?

Sometimes the answer is both, and that's okay. But make the decision with clear eyes about what you're getting for your money.

Hear the Full Discussion

This article covers the key insights from Fox Hill Wealth Management's comprehensive analysis of the private vs. public school decision. For the complete discussion, including specific data on educational outcomes, real family examples, and detailed financial scenarios, listen to the full "Wealth Wisdom" podcast episode.

Listen now on Spotify, Apple Podcasts, or YouTube

The team also shares personal experiences from both sides of this decision and discusses how this choice fits into broader family financial planning.

Need help modeling the financial impact of educational choices? Fox Hill's financial advisors can help you see how different education investments affect your family's long-term financial goals.

Contact Us Today

Remember: The best education for your child is the one that challenges them appropriately while allowing your family to remain financially healthy.