By Dr. Charles Patterson, WCI ColumnistIn a 2024 article on The White Coat Investor called “Buy This, Not That,” Dr. Jim Dahle claimed that a decent public education is available for anyone willing to spend the money necessary to move to the right school district. This is incorrect for a significant portion of American families, regardless of their income level. More importantly, the inference overlooks the real and impactful circumstances that influence decisions on schooling. Private education is rarely the only alternative, even if the financial implications of education were the only consideration in school selection. Boiling an educational philosophy down to “public vs. private” or “district vs. tuition” is reductive for many of us whose children and family circumstances demand careful thought and planning.
While the financial implications of alternative education strategies can be burdensome, the question of how we educate our children cannot be reduced to a matter of dollars and cents. Further, for those professionals in fields whose practices aren’t universally available in all states or municipalities, the idea that one can simply “move to the good district” is implausible. As Jim argues:
“Private school tuition can be as much as $40,000 per year. From kindergarten, $40,000 x 13 years = $520,000. If you have four kids, that's over $2 million in private school tuition. You're telling me you couldn't find a decent house in a decent school district for $2 million? I'm skeptical . . . ”
Private school can be expensive (especially compared to the local public school). But not all schools cost $40,000, and many are affordable even for a moderate-income physician. Frankly, the quality of public education in the place your career takes you may be questionable. The environment in that school may be toxic for your child. Education is not a “this or that” decision in the way that car purchases, mortgages, or investment strategies are. Rather, where (and with whom) you entrust your children for 40+ hours per week for 13+ formative years is a decision that can resonate well beyond your lifetime.
You can recover from many a poor decision. Your daughter only gets one shot at high school.
Of course, it may not be as drastic as all that for you and your family. Shalom. But for many, the decisions that surround education are burdened by questions of school safety, curriculum quality, service availability, and parent engagement. All this in addition to the effect that tuition will have on other savings priorities.
For a good portion of the WCI readership, this isn’t a question at all: the local public schooling system is satisfactory, if not excellent. For others, the local prospects may be so poor that an alternative is necessary. For the latter group—and those interested in immersing their children in a dual-language program, parochial or religious-based school, or subject-oriented private institution—the considerations extend beyond finance. This is a particularly important conversation for trainees and professionals with young families who are routinely thrown headlong into the diaspora of matches and new attendinghood.
The premise that a child’s education is similar to home purchases, car loans, and retirement strategies is too simplistic, and in the following paragraphs, I hope to convey why.
Understanding the Purpose of Education
The broad purpose of education is to form children into young adults who are morally sound, well-adjusted, competent, and productive members of society. Central to this objective is the cultivation of skills critical to the basic function of the communities that build our nation. Unfortunately, the public school system in the US is neither homogeneous nor uniformly capable of providing for all students and families. The strength of a given curriculum is not as straightforward as a 401(k) plan. We can agree that to be successful, a school requires more diligence in its function than does a set-it-and-forget-it disability insurance plan. The relative strengths, weaknesses, and variability of the schooling systems across the US leave me skeptical of the idea that education is a “buy this and not that” proposition.
Some public schools are great, and others are terrible. Tragically, public education has found itself at the forefront of cultural clashes. As a result, parents in some municipalities find their school system too Christian conservative, while others in neighboring states find theirs too liberal. And that's assuming that the local public classrooms are safe at all. Further, between budget cuts, extended teacher strikes, and challenges with parent involvement, finding a consistently excellent public school to which to send your children is not guaranteed. Clearly, some districts are (far) better off than others, illustrating the multiple applications of geographic arbitrage. But even if you have $2 million with which to buy a house in the right district (I don’t), it may be in a place far from your available practice location, family roots, or your family’s desired lifestyle. For those seeking to raise a family (especially young physicians), the conversation about education strategy is best had well in advance of the start of parenthood. The practical and financial implications are profound.
To be fair, many school districts out there are just fine, and some are truly excellent. That’s wonderful for them and the communities they represent. But there aren’t always jobs in those markets, let alone ones that will support the cost of living. Want to be a primary care doc in a place like Santa Clara County, California (or Loudoun County, Virginia)? Best of luck, friend: that $2 million house may not be unattainable on your income and unsustainable for your long-term financial goals. Perhaps the public schools in the cozy suburban enclaves are well run and with an ethos that matches the population. That’s nice if you find a job in your specialty at the time that you need one. But for much of America, this is not the case, and safe and trustworthy education isn't guaranteed.
Speaking for my subspecialty, the job market has been saturated for the last half-decade, with little change on the horizon. New postings that offer both a robust practice and proximity to family resources are competitive. Medical students, trainees, and young professionals who desire a fulfilling balance of career and family would be wise to consider this before their training pipelines start (and certainly before they end). While alternative schooling systems aren’t always available, they seem necessary.
Private education, home schooling, charter schools, and alternative co-ops are no panacea, either. Curriculums vary wildly, as does the competency of those instructing. Enrollment isn’t guaranteed, and no institution that cares for children is completely insulated from the horrors of child-targeted violence. More commonly and in our experience, private institutions are less equipped to provide for children with special needs. There are scruples there, too. In the same breath, we can lament that a child with behavioral challenges may be best served in the same school where they could be a distraction for other learners. None of this is simple, and that is exactly my disagreement with the “buy this, not that” mentality. In some cases, for the right child and the right family, private schools are the right choice.
It is possible to pay for private school and commit to the savings that will ensure your eventual financial independence and security. Everywhere we’ve lived, we have researched the schools available to us, including cost. If the local public school is satisfactory, then we invest the amount we would have spent on tuition in our kids’ 529s. If we opt for a private school, the 529 investment for that year is reduced.
None of the schools our kids attend have been $40,000 per year. Tuition costs at the schools we’ve looked at (K-8) have been between $4,000-$9,000 annually. That is serious money for a moderate-income physician, and it increases for high school if we decide to walk that path. But because we started education savings for each child at birth, those ESAs and 529s are already generous, even in the unlikely event we contribute no more from ages 6 to 18. Between GI Bill benefits, part-time jobs, and competing for scholarships, I feel content in knowing that our kids have both a leg up on higher education costs and some skin in the game. Barring something unforeseen in our financial world, we are not planning on bankrolling their JD or MBA. With real decisions to make on education now, we can still position our kids favorably for the future. Our choices and lifestyle may look different than my colleagues in the break room, but it doesn’t preclude a rich and fulfilled existence.
The choice in a child’s education is not akin to buying a new Mercedes on credit or YOLOing a pair of jet skis. The implications for your family can extend beyond finance, unlike buying a dumb doctor house. Professionals with young families disperse and diffuse to places where (1) the jobs are and (2) they think they can thrive.
More information here:
Balancing Retirement and College Savings
The Worst Financial Gifts to Give Your Kids
What Really Matters in a Child’s Education—and a Framework for Assessing It
While we're on the topic, we would do well to heed the studied factors that impact a person’s life path. Where you live matters. Acknowledging Jim's point, a child's zip code is probably one of the most important. Raj Chetty, et al describe this in their work with the US Census Bureau called The Opportunity Atlas. Your choice of neighborhood is important, but it's far from the only one in helping kids see their potential.
Childhood stress matters. Is your child more or less likely to experience toxic stress in a charter school vs. a parochial school? Are they more likely to witness violence at the local public or private school? Will they feel insecure in a rural, urban, or suburban environment? I don’t know, and this too seems overly simplistic. Money only goes so far in educational choice, and it's an ill-considered crutch. The emotional intelligence of peers, engagement of parents, and strength of school leadership are crucial in determining the flavor of the milieu in which your child is simmering.
Of course, who your child is matters. Kids are mostly snowflakes (which look, act, and react in a mostly similar fashion), each with their own special gifts, needs, levels of resilience, strengths, and weaknesses. What each child needs in a household (and outside of it) can vary dramatically. The learning environment that works for one may not work for another. None of that is new or novel.
Parents matter, and their involvement and activity are key to a successful learning community. For many reading this blog, navigating influence and affluence, unabating connectedness, relationships, and a developing prefrontal cortex will be bigger challenges in our kids’ lives than educational environments. When it comes to schools, sometimes good enough is as good as it gets. Parenting is harder. Nurturing a child takes time, thought, and patience. You may not have to pay for an education, but you always have to invest in it.
It's not as simple as “this or that.”
More information here:
Setting Expectations for the Moderate-Income Physician
Figuring It Out Early and Often
Parenthood is a messy, complicated business. Kids can be difficult, and their challenges are unlike those we experienced when we grew up. The mental health crisis in America’s children is real. I see it as a parent, and I see it first-hand in my practice. To be clear, I am not suggesting that your educational choices are going to solve this crisis any more than a penile amputation would solve heart disease. We would be remiss if we didn’t recognize the sad truth that bad things happen to kids in this world, no matter the parents and no matter the school.
Conversely, some children will thrive through adversity. At the same time, I struggle to see how the quality of public education will improve if all opted for home school, private school, or charter school. There is not, to my knowledge, a simple or easy solution to the systemic problems that plague our youngest generations. It's difficult to imagine a remedy without parents who are well equipped for parenthood, who build stable and loving homes from which schools become an extension. How we accomplish that is a matter of debate for another time and a different blog. Education based on a family’s mores is not a luxury; it's a consequence. Your child’s optimal environment for learning and growth may differ from your neighbors—or even from their own siblings.
As for me and my house, well, it changes every few years. As our kids grow and their talents and shortcomings become more apparent, their needs also evolve. This means that every year we reassess the strength of the education options available to us. In their time, our kids (like me) will likely see a mix of public and private schools. And if the opportunity presents itself, home schooling (especially abroad) may be the best course to broaden their horizons and enrich their minds.
Importantly, my retirement date does not change regardless of how we answer the schooling question. If your written financial plan includes education costs, the budget follows accordingly. Because education costs can be high, other choices are limited. Our houses will be smaller. There will be no new car purchases. There absolutely won’t be a wakeboat (didn’t want one, anyway). There won’t be any McLaren rentals, either (that one hurts as I’m a bit of a car enthusiast). These are all choices that we are grateful to have. Our financial independence, children’s development, and charitable giving goals need not be at odds.
For the most part as high-income professionals, the costs associated with education are tenable no matter the route. I suspect that for most readers, the greater struggle will be the tedious and frustrating work associated with balancing a busy career with the cultivation of a healthy, growing household. Some families may have the option of sending their children to high-quality public schools. God bless them. Others may choose to home school or enroll in a private institution. Peace be upon them as well.
But to reduce this question to a simple matter of personal finance is a bit pithy. If you are reading this, then you are, at the very least, on the road to financial literacy. With a sound written financial plan and the discipline to execute it, your retirement is going to be fine, regardless of where you send your kids to school.
What's your take on the public school vs. private school debate? Is where you send your children to school strictly a financial decision? Or are there other factors for you? What have you done in your own family and why?
People make choices in life. Most physicians should be able to find a practice in an area with good public schools. It’s a luxury to pay for private schools (which many can afford) and you should see it as such.
Your bio says you are a primary care doctor, so I’m sure you can find a primary care job if you wanted to even though you may not enjoy as much as your sub-specialty. As long you can meet your current financial goals, go ahead and pay for private school and don’t move. If not (like many who find this website) you need to make changes and public school is an option.
Hey Greg,
Thanks for reading and posting. I absolutely acknowledge that for many WCIers and their families, education is a non-issue. The local schools are just fine for their kids, and their savings are going to be secure. Jim is mostly correct (as usual) in writing that many WCI readers can simply buy into the “right” district and that will be satisfactory.
There is also a significant portion of this readership (trainees, early career physicians, and moderate income professionals), who I think would do well to thoughtfully consider education plans and contingencies as they embark on their careers. Few parents imagine that their child will have special needs, or will be a prodigy, or would thrive in X, Y, or Z environment. Thinking about this early is worthwhile in financial planning. Yes, people make choices in life. Might as well try and make the best ones.
A couple of points: As a physician, your child will qualify for almost zero college scholarships. They are almost entirely based on financial need. My son graduated in the top six of his class of 20,000 at a highly rated public university. He got $1500 total in scholarships, and that was from his high school. (I am a pediatrician.)
Secondly, if your child has any special educational needs, most private schools do not provide support for these.
This is a common misconception about Private schools. Although private schools are not required by law to accommodate IEP and 504 type plans, any good private school will work with you to accommodate those needs. In fact, speaking from experience with a child with a 504 plan, it was much easier to work with our private school on accommodating my child then going through the public school system. Depending on the area where you live the public school system could be flooded with IEP and 504 requests and thus in turn only support those above a certain threshold of severity.
They keep not printing my replies. I am a pediatrician so I deal with IEPs and 504 plans all the time. I won’t go I detail again, but the local private schools just believe in more discipline for academic difficulties. And don’t even think about sending a child with severe disabilities.
I agree the public schools can be difficult to work with. But something is better than nothing.
Finally, public schools have federal standards for which students they must accommodate. Legally they cannot deny interventions to anyone who qualifies.
This all sounds like the quality of private schools varies a lot by location. You are fortunate to have found a good location.
Zero need based scholarships perhaps. Many physicians’ children are high achievers like them and get academic, athletic, and other achievement/merit scholarships. Not sure why your kid didn’t get much, that’s a very different picture from my kid who also graduated near the top of her class. She was offered full tuition scholarships pretty much everywhere she applied and some places she didn’t.
These things must vary a lot by location. I was top of my class of 750, scored 99% on SAT and ACT, but based on my dad’s teacher’s salary (!), I got a $50 scholarship to University of Michigan, and $150 to MSU. (In-state for me.) Similar range for University of Chicago.
I did get full ride offers if I would become an engineer or go to schools such as Sweet Briar.
My son graduated HS in 2017. His HS/our community tried to give everyone who wanted to go to college a scholarship. That’s where his came from. We’re in Wisconsin now.
IMO there is financial aid that is need based, but scholarships based on academics are rare. For public universities or those with more stringent requirements.
Not trying to argue. Just YMMV.
“Zero need based scholarships perhaps.”
I am fully aware of the difference between a needs based scholarship and an academic scholarship.
But you don’t think doctors’ kids get academic scholarships at the same rate as other kids?
My husband and I both got full ride academic scholarships to a private liberal arts school in the South, and had options at many other schools as well. I know many other friends who had the same. Maybe its the schools to which you were applying but I don’t think academic scholarships are rare.
I agree with you Dr. Patterson. We can’t reduce the question to a simple binary choice. Our family moved 5 years ago because I was miserable living in a cold weather climate. The schools were “good schools” in our old district but the community didn’t match our preferred moral and faith convictions.
We have chosen an area that checks many boxes for us but the public options have 1000s of children(too large for our kids) and we hear from our neighbors about violence and other negative influences that we can not protect against forever but I’m glad to pay tuition to a faith based school to help insulate my children while they are still so innocent.
We love our school choice. It’s about $10k per year. We bought a new house to be close to this school to make our quality of life better. More family time and less commute time. So to add one more nuance to the debate, moving close to a reasonable cost private school in an area that you love and a state that gives a tax credit for 529 contributions, which can be used for k-8 education may be a great option for other readers.
I was raised to view public schools as where we should go and if lacking, (try to) improve the public schools. Of course I went to a top public school, with de facto segregation into Honors (95% white) and not (95% Black). Then I (via the Army) moved to the US South. We stuck it out but cheated a bit by 1- both kids spending some time at a magnet (public) boarding school in our state, and 2- actually for logistics (school commute) did a- one year home school, b- later put the youngest in a British ‘private’ school for 2 years when the Army paid for it (and due to disparities in British and US education plus a fall birthday had her then skip a grade) and c- crossed county lines to keep both kids at the nearest school together rather than two separate sites with more poor or Black students. I didn’t like my kid being the smartest kid in the school including all the teachers- was a bad thing for me to almost be that- and the magnet school and later being honors track at their Unis addressed this.
I think your most important point (aside from we can’t fix the school system ourselves- and I know had our public schools been as bad as some in the US I would also have gone private) is that different kids may need different things and even choosing the best school or school district one may end up with your child benefitting from a change from the plan.
I have indeed spent some time wondering if our Army career damaged our kids due to the crap school they had here in the South (even though it is one of the better ones locally). However pretty happy with how they’ve turned out so far.
Spot on, Dr. Patterson. This is such an individual decision, and I think it’s important as you mention to avoid reductionism.
My spouse and I have probably spent “too much” on our children’s education: parochial high school, private colleges, grad school for one, and currently helping with medical school as we’re able for the other, all on a single income probably in the same ballpark as yours. Is our net worth less than it might have been? Check. Will our kids inherit a bit less than they might have when we’re pushing up daisies? Check, presumably. Are we glad we’ve given with a warm hand in this manner? Absolutely!
So again, thanks for providing an important contrarian viewpoint on this issue.
Charles awesome article and great points dude. I think Jim really means that what you’re saying to really think about how much you’re gonna pay for education and actually quantify the value as you’re making a financial decision on whether to do public or private school.
A few points worth making here, especially since my name ended up in the title of this post. Now I know that wasn’t the title of the post when it was submitted, it’s the job of our content team to use the title that will make the most people click on the article and I suspect this one will do that.
It’s relatively easy to simplify a debate opponent’s argument and then swamp it with exceptions and the complexities of real life. But the article seems to insinuate that my personal views on this topic are both simple and wrong. I don’t think either of those is true.
Now I’ll fully admit that I’m a product of a public education (from a “government school” as my hyperconservative neighbor likes to call it) as is my wife. My wife has been elected to the public school board, volunteers in schools, and is a former public school teacher. All four of our children attended public K-12 schools and as near as we can tell are excelling in their educations and in life. The second just graduated as the salutatarian in a graduating class of about 600 (gave a great speech at graduation BTW) with a 4.0 and a 36 on her ACT. The school I graduated from currently has a GreatSchools rating of 6/10 and the local schools have ratings of 9 (elementary), 8 (middle school), and 4 (high school). We also have a financial website whose focus is helping people build wealth, not getting the very best possible education. As you can see, our bias is clearly toward public schooling.
As a general rule, I advocate that white coat investors save 20% of their income for retirement and then spend everything else on whatever they want. You should spend in accordance with your values. If you highly value a more highly rated private school education for your children or even just a different education for your children, you should spend your money there instead of on fancy vacations, boats, Teslas, early retirement, and huge inheritances. The more children you have, the more bang for your buck you get out of choosing the good school district option.
The choice often boils down to paying more for a house in a better part of town that happens to be zoned for an excellent public school versus finding a cheaper house in a less prestigious part of town/school district and then paying extra for private school. If the equation is that simple, you are likely to come out ahead financially with the house since the house will probably appreciate while you’re in it, good public school areas tend to stay good and keep property values up, and there are other benefits with living in the nice part of town.
But there is obviously a lot more that goes into this decision than JUST finances. Just like you don’t get married only for financial reasons or choose a specialty only for financial reasons, you don’t choose an education only for financial reasons. That doesn’t mean that your favorite financial blog should not make you aware of the financial consequences of your potential choices.
I mean, let’s take a local private school that happens to be near us. Tuition ranges from $25K for kindergarten to $36K for high schools. Let’s call it $30K for 13 years for simplicity in calculations. Assuming 8% returns on that money, that adds up to $645,000 by the time the kid is 18. If you let it ride until they’re 65, that will grow to $24 million. So you can EITHER send your kid to private school OR you can send your kid to private school and provide them $24 million for retirement. Even if we adjust all that money for inflation (we’ll use 5% instead of 8%) it still adds up to $5.3 million in today’s dollars.
Which would you rather have, a public education in schools rated 9, 8, and 4 and either $645K at 18 or $5.3 million in retirement or a private school education? I know which one would have made a bigger difference in my life. The choice is yours, but choose carefully. Life isn’t all about money, but choices have consequences.
Do you really think I’d exploit your name in a headline just to get a few more clicks?
The answer, of course, is yes.
I do:)
Just doing your job. Keep grinding Josh!
Nicely worded strong argument
Jim – as you’ve been telling us all for the past 10-15 years – you can have ANYTHING you want but not EVERYTHING. If private schools are what you want, then by that very choice, you are foregoing something in its place.
Regardless of the financial implications, there’s no flippin’ way that I would send my daughter to a public school in our state. Things are taught by the decree of the state legislature that are antithetical to our worldview. That pretty much leaves private school or homeschool, and given that we spend half the year traveling, the latter is what we’ve chosen, and our daughter is doing extremely well.
We all spend our money on what we value most I suppose. I would be curious if you ask your kids at 30 if they would have rather had the education they got or the millions their tuition would have grown to by then which one they would prefer.
I think you missed that we homeschool our daughter, which costs very little. And given that we spend half the year traveling, I think that she’s getting about as good of an education as any kid can.
So your (or your spouse’s) time is worth nothing? Don’t forget opportunity cost. I would be the most expensive teacher my family could hire. We’d be financially better off hiring 5 teachers full-time than having me teach them instead of work.
My wife’s time is very valuable. But she wanted to be a SAHM anyway, so homeschooling didn’t represent a financial opportunity cost for her.
Given that you chose to live around people who espouse your religious beliefs, I thought that you would better understand why people might choose educational paths for their children that are also reflective of such beliefs. Not all decisions come down to dollars and cents, and money is only a means to an end.
Sure it does. The time she spends teaching cannot be used for other homemaking/child raising activities or her own recreation.
I totally understand why you’re choosing to do this, I’m not sure why you think I don’t. I don’t have a problem with you choosing how to spend your time or money as you see fit. I agree that not all decisions come down to dollars and cents.All I did was point out there are costs to your choices and you need to be okay with them.
Of course there are costs and benefits to all our choices, but we’re clearly alright with ours or else we wouldn’t have chosen to stick with them.
I retired at 42 and left behind, in all probability, millions of dollars of earnings and investment growth, but I and my wife were totally onboard with that because we’d rather have the time and flexibility that we have now, besides other reasons. Further, homeschooling gives us a measure of flexibility that no other form of education I know of can provide. It’s certainly not for everyone but is ideal for us.
Awesome!