💰 How Much Do I Need to Save?
Fill in the basics. We do the inflation math and SIP math. You get the monthly number plus the full picture.
How to use this calculator well
Five quick decisions to make. Defaults are sensible.
- 1Tell us about your kid
How old is your baby right now (in months or years), and at what age will they need the money? For higher education, typically 18. For engineering specifically, 17. For abroad master's, around 22.
- 2Pick what they will study (or estimate)
Use our pre-set goals. Australian engineering, medical, abroad UG, abroad PG. Or enter your own custom target amount in today's AUD. Our calculator will inflate it correctly to what it will actually cost when your child gets there.
- 3Pick your expected return
12% is reasonable for long-term equity SIP. 10% is conservative. 8% if you plan to keep the money in PPF or debt funds. The lower the return, the more you have to save monthly. But lower returns are safer.
- 4See the monthly SIP needed
You will get the exact monthly investment required, the total amount you'll invest over the years, and what the fund will grow to. Plus a year-by-year projection so you can see how the corpus builds up.
- 5Try the step-up version
If a flat 25,000/month feels impossible right now but you expect your salary to grow, try a step-up SIP. Start at 15,000 today, increase by 10% every year. By year 18, your monthly contribution is closer to 75,000. But your starting burden is half.
When I first ran this calculation for my own kid, the number that came back made me feel sick. 50,000 a month, are you kidding? But then I broke it down. We started with 8,000. Stepped up every year. Eight years in, we are at 16,000. The corpus is on track. The trick is to start small but to start. The number that scares you is hypothetical. The number you actually invest is real.
The math is correct. The assumptions (inflation, returns) are based on historical Australia data. Your specific tax situation, risk tolerance, and family circumstances need a SEBI-registered advisor. Use this for planning conversations, not as the final word.
How this calculator actually works
No magic. Just two formulas. Inflation forward, then compound SIP backward. We show you the math. Plus the assumptions and what your numbers actually mean.
Step One — What will it actually cost when your kid gets there?
The first problem with education planning is that everyone thinks in today's AUD. A engineering degree costs A$10k today. But your 1-year-old won't go to college today. They will go in 17 years. And every single year, fees go up.
This is called education inflation, and in Australia it runs at roughly 9-11% per year — nearly double regular inflation. Why so high? Private colleges keep raising fees because demand for seats keeps going up. Hostel costs, books, coaching — everything compounds.
Step Two — How much to save monthly to hit that target
Now we work backward. We know how much we need (FV from step 1). We know how many years we have. We know what return we can reasonably expect from our investments. The question is: what monthly SIP will grow into exactly that target?
This is the inverse Future Value of Annuity formula. It assumes you invest the same amount every month, and your money compounds monthly.
Step Three — How much will you actually invest? How much is just growth?
This is the part most people miss. Of the A$50k you eventually have, how much did you put in vs how much was just compound interest doing its thing?
If you invest 7,442 a month for 204 months, your total contribution is just A$15k. The other A$35k is pure growth. You contribute 30% of the final value. The market gives you 70%. This is why starting early matters so much. Compound interest is your free employee that works 24/7 for 18 years.
| Total invested | 7,442 × 204 = 15,18,168 |
| Total growth | 50,50,000 − 15,18,168 = 35,31,832 |
| Multiplier | 3.32x (final value / what you invested) |
The cost of delay — why every year you wait hurts you
Here's the cruel mathematics of compound interest. Two parents, same goal, same return rate. One starts when baby is born. The other delays by just 5 years (because hospital expenses, EMI, kids stuff, the usual).
| Start at age 0 | 18 years, ~6,200/month, total invested A$13k |
| Start at age 5 | 13 years, ~10,800/month, total invested A$16k |
| Start at age 10 | 8 years, ~21,500/month, total invested A$20k |
Step-up SIP — what to do if the number feels impossible
Let's be honest. A young parent with a new baby is rarely flush with cash. The required monthly SIP can feel out of reach. The step-up SIP is the smartest workaround.
Instead of starting at 25,000 and keeping it flat for 18 years, you start at 15,000 and increase by 10% every year. By year 18, you're contributing roughly the same as the flat 25,000 plan — but your starting burden is 40% lower, which matches how salaries actually grow.
A 28-year-old IT professional earns 8 LPA today. By 35 (when child is 7), salary is closer to 18 LPA. By 45 (child is 17), salary is around 35-40 LPA. Saving capacity grows with income. A step-up SIP grows with it. A flat SIP doesn't.
Year-by-year corpus growth — where the money actually goes
The most encouraging thing about long-term SIPs: the final 5 years grow the corpus more than the first 10. Compound interest is exponential, not linear.
| End of year 3 | A$3k (1.4 invested, growth 50K) |
| End of year 7 | A$10k (4.5 invested, growth A$6k) |
| End of year 12 | A$22k (8 invested, growth A$15k) |
| End of year 17 | A$50k (15 invested, growth A$35k) |
Where to actually park this money
The calculator gives you a number. Now you need a vehicle. Here is what makes sense for different time horizons (this is general information — not investment advice).
80-100% equity mutual funds. Pick 2-3 large-cap or flexi-cap funds with 10+ year track records. Use SIP, don't time the market. Expected return: 12-13%.
60-70% equity, 30-40% in PPF/debt. PPF is excellent here — tax-free, 7.1% return, matches the 15-year lock-in to your kid's school journey. Expected return: 9-10%.
40% equity, 60% debt/hybrid funds. Start shifting from equity SIP to balanced funds. You can't afford a 2008-style crash this close to needing the money. Expected return: 8-9%.
90% debt, fixed deposits, debt mutual funds. Move equity gains to safer instruments. The corpus you've built must be protected. Expected return: 6-7%.
Things to plan for that the calculator doesn't show
The corpus number assumes one lump education goal. Real life has more variables.
- School fees during the journey: A decent private school in a metro costs 1.5-A$3k per year. From age 3 to 17, that's another 25-A$50k total — outside this fund.
- Coaching: JEE/NEET coaching can cost 3-A$7k in classes 11-12. Plan separately.
- Currency risk for abroad: If your child studies abroad, the AUD will likely depreciate against USD. Build a 20-30% buffer into abroad targets.
- Hidden costs: Hostel, mess, books, lab fees, internship travel, gadgets. Add 25-30% on top of tuition for the full cost.
- Marriage costs (if relevant): A separate goal entirely. Don't dip into education funds for it.
Reality-check categories — what different goals actually cost
Sanity check for what people typically aim for. Numbers in today's AUD:
The honest disclaimer
This calculator gives you a planning number, not a guarantee. Returns are not guaranteed. Inflation may run higher or lower than assumed. Your kid may want to study something we didn't list. Your salary may grow faster or slower than expected.
The point of this calculator is to start the conversation — with your spouse, with a financial advisor, with yourself. To replace vague worry with a concrete number. Whether that number is 7,000 or 70,000 a month, knowing it is better than guessing.
One more thing: we are not financial advisors. Anything in our explanation is general information based on publicly available data and standard math. For your specific situation, please consult a SEBI-registered investment advisor.
The questions every parent asks
Is this really how much I need to save? It looks like a lot.
Where should I actually invest this monthly amount?
What return rate should I assume? Markets feel uncertain.
My baby is just 6 months old. Is it too early to start?
I can't afford the suggested amount. What do I do?
Should I include education insurance in my plan?
What about my child studying abroad? Those numbers seem impossible.
Should I save in my child's name or my own name?
What if my child wants to start a business instead of studying?
Is the data I enter saved or shared?
How education fund planning actually works in Australia
Australian pediatric care runs through a mixed public-private system. Medicare covers GP visits and public ED visits. Many families also have private health insurance for faster specialist access. Your first call for after hours fever or illness is typically Healthdirect on 1800 022 222. Free, 24/7 nurse line. The Maternal and Child Health Nurse system is one of the best in the world. Free and accessible. Royal Childrens Hospital Melbourne, Westmead in Sydney, Queensland Childrens, Perth Childrens. These are the specialty ED centres for serious cases. For rural and remote families, telehealth through 13Health in Queensland or HealthDirect federally is critical. Royal Flying Doctor Service covers the genuinely remote stuff.
In Australia, call Healthdirect on 1800 022 222 for free 24/7 health advice. For emergencies, call 000. Maternal and Child Health Nurses (free in most states) help during business hours. Your GP is the first point of contact. The Tresillian Parent Helpline (1300 272 736) also handles concerns about babies.
What Australian mums actually deal with
Aussie mums tend to be pragmatic about baby illness. Cultural default leans toward "she will be right." Combined with reasonable access to nurses and GPs, this generally works. The Maternal and Child Health Nurse system is a treasure of the Australian health system. Use it without hesitation. Telehealth normalised during COVID and stayed normalised, which is genuinely useful. The unique Aussie concerns are bushfire smoke season and extreme summer heat. Babies are more vulnerable to air quality than adults. Sun and heat exposure can cause apparent fever via overheating. Always check core temperature properly (rectal or under-arm thermometer), not just the forehead, especially in summer.