Arthashaastra

Buying a home or planning retirement may dominate most financial plans, but there’s one goal silently becoming more expensive: a child’s education.

Education, especially in urban India, has transformed from a basic necessity into a high-cost, long-term investment. And most families don’t realise its impact until it’s too late.

Beyond Tuition Fees: The Silent Surge in Household Education Spending
When we think of education inflation, we think of tuition fees. But zoom out, and a more structural shift is visible: Indian families are choosing to spend more on education.

In FY12, households spent ₹1.8L crore on education.
By FY24, this soared to ₹8.43L crore — a 4.6x increase in 12 years.
This isn’t just about rising costs. It reflects a behavioural shift. In FY12, education made up 3.1% of total private consumption. By FY24, it rose to 4.1% despite the inflation and job insecurity.

💡 Per capita PFCE on education also rose from ~₹1,500 in FY12 to ₹6,100 in FY26.

Education is no longer just an expense—it’s a non-negotiable investment. One that families are increasingly unwilling to compromise on, regardless of external uncertainties.

The Real Cost of Private Schooling in India
A closer look at fee structures from premium schools across Mumbai, Delhi, Pune, and Hyderabad reveals a harsh truth:

School education alone is now as expensive as an MBA was. In cities like Pune, Hyderabad and Mumbai, 15 years of schooling can cost more than ₹15 lakhs, especially in international or IB boards. And this doesn’t include uniforms, books, and admission fees, just the tuition fees.

➔ Mumbai
Elite school education in Mumbai is nearly 8 times costlier than mid-range schooling. For example, just VIth to Xth Grade education can cost ₹20.8L in elite schools vs ₹2.5L in mid-range ones. Top-tier schools like École Mondiale and Oberoi International drive this premium. Overall, total education costs in Mumbai range from ₹7.9L to ₹61.2L, depending on the school category.

Source: University Websites, 1 Finance Research

➔ Delhi
In Delhi, even affordable schooling costs over ₹9L, pushing the limits of affordability. In Delhi, total schooling costs range from ₹9.7L to ₹35.2L, based on the chosen category.

Source: University Websites, 1 Finance Research

➔ Pune
Pune’s mid-range schools are costlier than elite schools in Delhi, with elite education averaging ₹76.2L. Schooling at top schools like Mahindra International can cost ₹1.68 Cr, and just Grade XI-XII in Pune elite schools can cost ₹15L. Overall, schooling in Pune ranges from ₹9.1L to ₹76.2L.

Source: University Websites, 1 Finance Research

➔ Hyderabad
Across major Indian cities, Classes VI to X have emerged as the most expensive schooling phase, especially in Hyderabad, where elite schools charge as much as ₹32.4L just for these five years. Overall, total education expenses now range from ₹7.1L to ₹69.7L, depending on the type of school chosen.

Source: University Websites, 1 Finance Research

➔ Bangalore
Elite school education in Bangalore costs significantly more than mid-range options, with total expenses ranging from ₹9L to over ₹25L. The premium reflects international curricula, better student-teacher ratios, and enhanced facilities and activities.

Source: University Websites, 1 Finance Research
(Note: The average schooling costs for XIth and XIIth grades in the affordable school category are not included here due to a lack of available fee data from many affordable schools.)

School Fee Inflation > MOSPI’s Education Inflation
The detailed analysis of school fee data from several leading institutions highlights a consistent upward trend. Fee hikes vary widely, with some schools experiencing a CAGR of over 15% annually. This rapid increase highlights the importance of financial planning for parents seeking to provide a high-quality education for their children.

Education inflation is not a future problem; it’s already here. Most still think of education savings as a one-time, milestone-based goal (like college fees at age 18). But the data shows a clear trend: families need ongoing education budgeting, from kindergarten to post-graduation.

Start Early: A modest SIP combined with thoughtful asset allocation can turn massive expenses into manageable goals.
Budget for the Full Picture: Tuition is just the tip. Factor in books, transport, living costs, and index them to 7–9% inflation.
Use Loans as Levers, Not Lifelines: Avoid last-minute panic borrowing.
Track Scholarships Early: Don’t miss deadlines, start looking 1–2 years ahead.
Just like retirement, education is now a multi-decade expense that requires structured planning, diversified investments, and regular reviews.

With education inflation often outpacing headline CPI, the best way families can stay ahead is by treating it not as a future goal but as an active, evolving financial commitment.

Securing Your Future: The Untouchable Financial Asset

In the ever-changing landscape of self-employment, financial independence is crucial—not just for today, but for tomorrow. Yet, many self-employed individuals face unique challenges when it comes to safeguarding their wealth. Here's the reality: traditional financial assets are often tied to regulations that may expose them to unforeseen risks of seizure.

What if you could create a financial asset that is truly untouchable? An asset that protects your hard-earned wealth under any circumstance, shielding it from external authorities or complications?

Such a product is not just a luxury—it's a necessity for self-employed individuals who want to fortify their financial security and ensure peace of mind. It empowers you to take control of your future, no matter where life takes you.

The Importance of Untouchable Financial Assets:

Creating such an asset isn’t just about safeguarding money—it’s about building a legacy. As entrepreneurs and self-employed professionals, we owe it to ourselves to think ahead, to innovate, and to secure what matters most.

What are your thoughts? Let’s discuss strategies and solutions that empower you to achieve financial resilience.

Add shine to your portfolio the MF way!

As the festive season draws near, we rush to buy gold and silver on auspicious days. But instead of buying physical gold and silver and storing it ourselves, is there another convenient and efficient alternative? Yes, there is!
You can invest in gold and silver through mutual funds (MFs) as well! For example, when you invest in Gold Exchange Traded Fund your funds are invested in physical gold bars with purity of 99.5% fineness or above! It is a similar case with silver. With investments in Silver ETF your funds are invested in physical silver bars with purity of 99.9% fineness or above. Thus, by investing in gold and silver through the ETF or Fund of Fund (FoF) route, investors do not have to deal with the hassle of storing the metals or worry about the purity. We store the precious metals in custody, while you enjoy the convenience of transacting easily!

Improved taxation post latest Union Budget

Investing in gold and silver through mutual funds has become more beneficial with the taxation changes announced in the latest Union Budget in July 2024. For units of gold and silver ETFs and FoFs acquired on or after April 01, 2023, a 12.5%* Long Term Capital Gains (LTCG) rate (> 12 months holding period for ETFs, > 24 months holding period for FoFs) would be applicable if redeemed after March 31, 2025.
Further, gold ETFs now have a shorter holding period of 12 months to become eligible for LTCG, compared to physical gold where the holding period is 24 months. This is an additional reason for investors to consider buying gold ETFs (which hold in custody physical gold on behalf of investors) vs. investors purchasing and storing physical gold themselves.
Source: India Budget.
*Surcharge and Health & Education Cess as applicable.

Enjoy the liquidity advantage when investing through the MF route
Lastly, investing in gold and silver through mutual funds gives investors the advantage of easy liquidity vs. owning physical bars themselves. Weekend Bytes | October 2024 3/5 Improved taxation post latest Union Budget Investors can buy/sell ETF units on the stock exchange each trading day. FoF investors can also invest / redeem units on a daily basis, just as they would with a normal mutual fund scheme. These transactions can be done effortlessly with the click of a button!

Gold and silver offer diversification and balance against portfolio volatility

While we tend to purchase gold and silver during the festive period for auspicious reasons, it is worth recalling other reasons why one should consider investing in gold and silver. Gold is considered to balance portfolios against the volatility of other asset classes. It could also serve as a buffer against currency depreciation and geopolitical shocks. Similar to gold, silver also offers the benefits of portfolio diversification and buffer against currency depreciation. Interestingly, silver also has considerable use as an industrial metal in new age technologies including Electric Vehicles (EVs) and solar panels. These factors make silver a potential attractive investment.
To conclude, investing in gold and silver through mutual funds provides numerous advantages to investors – investment in physical gold and silver bars of high purity with no hassle of physical storage, convenience of transacting, easy liquidity and the ability to invest in small amounts regularly through Systematic Investment Plan (SIP).

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