Education getting expensive? Try these 5 tips for saving money

Every parent wants to give their child the best start in life. From the moment you choose the right school to the day you think about college counselling, every decision feels like a step toward building your child’s future. But there’s a growing concern many parents silently carry — the rising cost of quality education.

You’re not alone if you've looked at fee structures and thought, “How will we afford these five or ten years from now?” The truth is many middle-income families are feeling the same pressure. But the good news? You can take small, smart steps today to make a big difference tomorrow.

This article offers realistic, actionable tips for saving money that align with your daily life and long-term dreams. And through it all, we’ll show you how IDFC FIRST Bank can be a valuable partner in that journey.

The real cost of education — and why it’s rising faster than you think
 

Let’s start with a simple question. What does education cost today, and what will it cost when your child is ready for college?

You may be paying ₹50,000 annually for primary school now. But higher education, especially in fields like engineering, law, or medicine, can easily run into lakhs per year. And those numbers don’t include living expenses, study materials, or travel.

This isn’t just regular inflation. This is education inflation—and it’s outpacing most other household costs. The impact of inflation on education is sharper than in many other sectors, directly affecting how much you’ll need to save.

As of April 2025, the education inflation rate stands at 4.13%, according to the Ministry of Statistics and Programme Implementation (MoSPI). It was 3.98% just the month before. That’s a steady climb. If the present rate continues, a ₹5 lakh degree today could cost over ₹9 lakh in 15 years. That’s why relying on your current income or waiting until your child is in their teens to start saving isn’t enough.

The peace of planning early: Why now is the time
 

Imagine your child gets an admission letter to their dream university, and you have the money ready. No last-minute loans. No panic. Just pride.

This isn’t wishful thinking. It’s the power of starting early. Small savings over a longer period reduce financial strain later. If you save ₹2,500 per month from your child’s first birthday, by the time they turn 18, you’d have nearly ₹10 lakh — assuming a modest interest rate of around 7% annually.

That’s not just good math. That’s financial security for your family.

Short-term needs vs long-term goals
 

It’s important to separate your savings for two different educational stages:

1. Short-term needs, like annual school fees, uniforms, and extracurricular costs
2. Long-term goals, like higher education fees, living costs, and coaching classes

Short-term needs can be managed through disciplined monthly budgeting. Long-term goals, however, need focused planning and sustained saving. That's where these next tips for saving money come to your rescue.

Five practical tips for saving money to secure your child’s future
 

Here are five clear and effective tips for saving money tailored for middle-income parents who want real solutions, not vague advice.

1. Open a separate education savings account early
 

This is one of the simplest tips for saving money, yet one of the most effective. Keep education money separate from your everyday account. This prevents accidental spending and gives you a clear picture of progress. 

When you’re looking for tips for saving money, it helps to have tools that work for you. The IDFC FIRST Bank Savings Account offers

1. High interest rates up to 7% p.a., helping your savings grow faster
2. Monthly interest credit, which compounds your returns
3. Zero fees, so your savings stay intact
4. Easy online access, so you can track progress anytime

2. Set up a Systematic Investment Plan (SIP) for your child’s future
 

SIPs allow you to invest small amounts regularly in mutual funds. Over time, these investments can grow significantly. Start with as little as ₹500 per month.

Why do so many parents rely on SIPs for planning an education fund for their children?

a. They’re affordable, flexible, and suited to long timelines

b. They offer higher growth potential than fixed deposits

c. You can adjust the amount as your income increases

For better balance, pair SIPs with other long-term tools:

a. A Public Provident Fund (PPF) offers tax benefits and long-term safety

b. Child-specific insurance plans provide security against life uncertainties

Together, these create a strong, future-ready strategy. But always anchor it with a higher interest savings account to hold short-term or emergency education expenses. That’s one of the underrated yet effective tips for saving money that parents often overlook.

3. Automate savings through standing instructions
 

You’re already juggling school drop-offs, meetings, and grocery runs. Let automation take one task off your plate. Set up a standing instruction from your primary account to your child’s education fund. Every month, the money moves automatically. You don’t think about it, but the savings add up.

It’s one of those tips for saving money that works silently but powerfully, because consistency beats big, occasional deposits every time.

4. Create milestones with clear targets
 

Instead of saying “I want to save for college,” break it down,

a. ₹2 lakh for high school coaching

b. ₹5 lakh for undergraduate fees

c. ₹3 lakh for post-grad options

Once you’ve set targets, you can reverse-calculate how much to save monthly. This step turns a vague hope into a concrete plan — and it's one of the most empowering tips for saving money you can follow.

5. Start with toddlers — and scale up
 

Even if your child is just starting preschool, the best time to begin is now. Begin with small amounts. As your income grows, increase your contributions. This flexible approach helps you stay consistent without cutting back on current lifestyle needs.

This final point may be the most overlooked tip for saving money, but it gives you the longest runway to grow your child’s education fund.

Common mistakes to avoid when saving for education
 

Avoiding these pitfalls ensures your efforts lead to real, measurable outcomes:

Why come to IDFC FIRST Bank for this specific problem
 

You don’t need to be a finance expert to prepare for your child’s future. You just need the right mindset, consistency, and a few powerful tools. These tips for saving money can help any parent build an education fund over time, without stress, loans, or regrets.

After all, the goal isn’t just to save—it’s to save smartly. That’s where the right banking partner makes all the difference. Here’s what makes IDFC FIRST Bank Savings Account a strong partner for parents:

1. Offers up to 7.00% p.a. interest, helping your savings grow faster — crucial when time is limited and fees are rising
2. Monthly interest credit gives your savings more power through compounding — every Rupee works harder for your child’s future
3. Zero-fee banking on all key services — no hidden charges on IMPS, NEFT, RTGS, debit card uses, ATM withdrawals, SMS alerts, or cheque books
4. Choose between ₹10,000 or ₹25,000 average monthly balance variants — flexible enough for different income levels
5. Quick and secure online account opening with video KYC — no paperwork or bank visits needed
6. Access your account and savings goals easily through a modern, user-friendly mobile app
7. Comes with value-added features like accident insurance cover, higher ATM withdrawal and purchase limits, and free airport lounge access with certain cards — useful as your child’s needs and activities increase.

With these features, you won’t just be saving — you’ll be making every Rupee count. These are real-world, actionable tips for saving money that any family can implement. Start securing your child’s future today with a smart, high-interest savings Account from IDFC FIRST Bank — because the best time to plan is now.

What makes the IDFC FIRST Bank Savings Account stand out?
 

1. Competitive interest rates up to 7% p.a. to help your savings grow
2. Monthly interest credits for faster compounding and greater flexibility
3. Full digital banking access through the IDFC FIRST Bank Mobile Banking App and net banking
4. Premium debit cards with rewards, insurance cover, and lifestyle perks
5. Zero charges on 36 essential savings account services
6. Quick, paperless account opening with minimal documentation
7. Recognised as one of the World’s Best Banks 2025 by Forbes, in partnership with Statista - trusted by millions across India