Payment schedule/plan for private school

[Anonymous]

Anonymous wrote:We did 2 installments the last three years. The first year, we were in a new job situation we were unsure of and did monthly which made the additional insurance mandatory (I think ours was an additional $900/annually).

Do read the insurance fine print, though. I think we switched to the 2 installments because our fine print said something like after January, you're on the hook regardless or something along those lines. I'm not sure what the exact wording was, but it was clear it wasn't really insurance after a certain point.

+1
We’ve never bought the insurance, although we do carefully consider it each year. We’ve always come to the conclusion that its usefulness is extremely limited (for us!) and the only use-case (again, for us) — if DC were to get so sick or injured that we had to pull them out — is a very low likelihood (DC has no underlying health concerns and is not an athlete) that the cost was not worth it.

There is language in the contract that excludes almost every reason the school might shut down, so it doesn’t help there. We have family support that would enable us to finish out the year if something happened to us (parents) health-wise or job-wise; we would not pull DC out for any of that. And it’s prorated and after a certain point (I want to say Feb but I’d have to look it up) you don’t get anything back, so that further reduces its usefulness.

[Anonymous]

Anonymous wrote:We did 2 installments the last three years. The first year, we were in a new job situation we were unsure of and did monthly which made the additional insurance mandatory (I think ours was an additional $900/annually).

Do read the insurance fine print, though. I think we switched to the 2 installments because our fine print said something like after January, you're on the hook regardless or something along those lines. I'm not sure what the exact wording was, but it was clear it wasn't really insurance after a certain point.

This is a good point as the tuition insurance usually only covers you until halfway through the school year.
At our school, tuition insurance is required regardless of how you pay and it covers you through January. But the last monthly payment is due in January, so it all kind of works out. We pay the nominal monthly fee to pay monthly and keep the money in an HYSA and have automatic transfers set up.
Although sometimes I wonder if we should pay in two installments and avoid getting the monthly tuition bills that just remind me how expensive tuition is!

[Anonymous]

Weird - at our school the insurance covers through the whole year (but only pays you back for a percentage of the remaining tuition, so the total amount you can get of course declines over the year).

We've always done the 2 payment thing because the monthly costs more. We got insurance the first year we were there but then didn't after that because our kid is happy, we don't especially anticipate something changing, and many of the reasons that might lead us to leave (like pandemics, or not feeling safe in DC anymore or something due to geopolitics) are all excluded anyway.

[Anonymous]

Monthly. Pre-COVID, my kids were at a truly wonderful church preschool that closed abruptly after a leadership change. Folks that paid upfront had a really hard time getting their money back.

[Anonymous]

We did 2 lump payments/year initially with one child in private school. Now that we have 2 kids in school, we do monthly. I like monthly for the following reasons:

(1) we earn interest on the money during the year, which offsets the modest discount for lump payments;

(2) we find it easier to plan and monitor our family budget with monthly draws instead of lump payments;

(3) if an unexpected issue arises, I think we are better positioned with the money in our account versus the school's account.