Child Education Calculator

In 2026 rupees: a four-year engineering degree at a top private college (BITS, VIT, SRM) runs ₹16–25 lakh including hostel; a five-year MBBS at a private medical college runs ₹50 lakh–1.5 crore; a two-year MBA at a top-20 private B-school costs ₹20–35 lakh. Public-sector seats (IITs, NITs, AIIMS, IIMs) are 60–80% cheaper but harder to secure. Overseas undergraduate education runs ₹1–1.5 crore for a four-year US bachelor's and ₹50–80 lakh for a UK/Australia/Canada equivalent. Cost grows roughly 8–10% per year — an education priced at ₹25 lakh today is around ₹54 lakh in 12 years.

Education inflation in India has historically run 8–11% per year — meaningfully higher than general CPI inflation (5–6%). The gap is driven by limited supply of quality seats (selective private + government colleges add capacity slower than demand grows), faculty wage growth, and infrastructure spend per student. Use 9–10% as a safe planning assumption for Indian college costs and 6–8% for overseas (foreign education inflation in INR terms is partly offset by exchange rate). Build a 1–2% buffer on top of these — being slightly over-funded is much better than the alternative.

From the child's first year — earlier is dramatically better because compound returns over 17–18 years do most of the work. A ₹10,000/month SIP started at year 1 at 12% return grows to roughly ₹65 lakh by year 18; the same SIP started at year 5 grows to only ₹35 lakh by year 18. The difference (₹30 lakh) is entirely the cost of waiting four years. If you can't start at year 1, start at whatever year you can — the comparison is to starting later still, not to the impossible "what if I'd started earlier."

Goal horizon dictates allocation: 10+ years out, equity-heavy (large-cap + flexi-cap funds) typically 80–90% of the SIP; 5–10 years out, balance to ~60% equity / 40% debt or hybrid funds; in the final 3–5 years before the goal, shift progressively to debt to lock in gains (sequence-of-returns risk at the goal year is the single biggest threat to the plan). A simple two-fund approach: one diversified equity fund (Nifty 500 index or active flexi-cap) plus one short-duration debt fund, with the equity:debt ratio shifting toward debt as the goal year approaches.

SSY is a strong Section 80C instrument for daughters under 10 — currently paying 8.20% tax-free with 21-year lock-in (or until marriage after age 18). Maximum ₹1.5 lakh per year. The lock-in is the trade-off: funds can't be withdrawn early except for education at age 18 (up to 50% of balance) and marriage at 18+. For a daughter's education goal, SSY makes sense as the "secure base" portion of the corpus (₹1.5L/year × ~18 years × 8.2% compounding produces roughly ₹60–65 lakh tax-free at maturity). Layer SIP-based equity exposure on top for the additional amount needed.

Depends on the math. An education loan in India runs 9–12% interest with collateral, 11–14% without. Section 80E allows full interest deduction for 8 years from repayment start. SIP returns at 12% pre-tax (10.2% post LTCG) over 15+ years typically beat loan interest after the 80E shield. Conclusion: saving via SIP is usually the cheaper path if you have 15+ years runway. Education loans make sense when (a) the gap between corpus and cost is small, (b) the child's expected income justifies the EMI, or (c) you want to preserve liquidity for emergencies. Most families end up using a mix — save the bulk via SIP, top up with an education loan for the shortfall.

It solves the standard SIP future-value equation in reverse: given a target corpus, expected return rate, and tenure, what monthly investment grows to exactly that corpus? The "inflation adjust target" toggle, when on, first inflates today's rupee target to future rupees using the inflation rate you set — so a ₹25 lakh target in today's money becomes ₹54 lakh in 12 years at 9% education inflation, and the SIP needed is sized to hit ₹54 lakh, not ₹25 lakh. The math behind this is the same engine used by the Goal SIP and Goal Inflation calculators — see those for the full formula breakdowns.

Three workable adjustments in order of impact: (1) Start with a smaller SIP and step it up annually — a 10% annual step-up on a ₹5,000 SIP over 18 years builds nearly as much corpus as a flat ₹15,000 SIP. Use the step-up SIP calculator to size this. (2) Stretch the goal year — moving from 15 years to 18 years cuts the required monthly SIP by roughly 25% (compound returns disproportionately reward the last few years). (3) Mix instruments — combine the SIP with PPF (7.10% tax-free) and / or SSY (for daughters, 8.20% tax-free) under the 80C umbrella. Education loans at the goal year cover any residual shortfall.