For many Irish families, the cost of putting a child through college can rival a house deposit. Yet while parents may spend years planning for a mortgage, many only start planning for college when the CAO offer arrives.  On August 26, as CAO offers land in inboxes across the country, many Irish families will face the reality of what comes next – which is, by design, entirely at the mercy of our course-based application system.  

When Tom and Mary from Cork received the news that their son had secured his first-choice CAO offer in Galway, they were understandably delighted. Years of hard work had paid off.   However, their excitement was quickly tempered by the cost. A student living away from home could easily cost the family close to €55,000 over the course of a four-year degree. 

The University of Galway points prospective students towards living costs that can run to €13,500 for each academic year, while University College Dublin estimates total annual costs for Irish students in the region of €15,000 to €20,000 per year, depending on accommodation choices, location, and availability.  

For many families, accommodation has become the single biggest college expense, often exceeding parents’ expectations and placing additional pressure on household finances, before accounting for food, transport, books, technology and everyday spending. As the costs mounted, it became clear to Tom and Mary that sending their son to Galway was not simply another household bill, but a major financial commitment. 

They began asking questions many families ask too late. Should they use savings? Should they reduce pension contributions? Would cash held on deposit be sufficient, or should some of those funds have been invested years earlier? 

Their story is far from unique. 

Similar conversations are taking place in homes across the country. A family in Donegal may be facing the cost of supporting a child in Dublin, while parents of twins in Mayo could be trying to help one daughter move to Cork and the other to Maynooth. Regardless of location or circumstance, the challenge is often the same: balancing education costs against other major financial goals.  I have met parents who had spent years building pension savings only to raid those funds because they underestimated college costs. In many cases, the financial pressure comes not from a lack of income, but from a lack of preparation.  One of the most important principles in financial planning is that your child may be able to borrow for education, but you cannot borrow for retirement. 

It can be an uncomfortable reality for many parents. Naturally, most of us want to give our children every opportunity possible, and education is one of the most valuable investments we can make in their future. However, in the desire to help, some families risk overlooking their own long-term financial wellbeing. 

The most common steps parents take can sometimes be the most short-sighted, whether that’s by reducing pension contributions, dipping into retirement savings, or postponing retirement plans. While these decisions often come from the best of intentions, they can have consequences that extend far beyond the college years.  Unlike education costs, retirement cannot be deferred indefinitely. There is no student loan available to replace years of missed pension contributions, and every year that retirement savings are delayed is a year of investment growth that cannot be recovered.  That is why college funding should never be considered in isolation. It needs to form part of a broader financial plan that balances supporting children today with maintaining financial independence in later life. The objective is not to choose between your child’s future and your own. It is to create a plan that allows you to support both. 

Of course, the ideal solution is to start early. Families who begin saving when children are young benefit from two powerful advantages: time and compounding.

Consider a family that saved €100 per month from primary school age and gradually increased contributions as their income grew. Assuming those savings achieve an average return of 6% per annum, the fund could grow to approximately €55,000 by the time that child receives a college offer at age 18.  Of course, not every family has the opportunity to start saving when their children are in primary school. Rising living expenses, mortgage costs, childcare expenses and the day-to-day pressures of family life can make long-term saving difficult. 

The good news is that effective planning is still possible, even if college is only a few years away. Families often have more options than they realise: existing savings, investment portfolios, regular savings plans, and even the timing of major expenditure can all play a part in funding education. A review of household finances will often uncover opportunities that were not previously obvious. 

This is where professional financial advice can add real value – helping families make the best use of what they already have, while protecting retirement plans and emergency reserves. The most important thing is not whether planning began when a child was five. It is whether it begins now, well before the next CAO offer lands.  For Tom and Mary, that planning came after the offer, not before it. They found a way through, as most families do, but with less choice, and more pressure, than they might have had. 

The families who cope best with college costs are rarely those who earn the most. More often, they are the ones who gave themselves the gift of time – and who understand that supporting a child’s education and protecting their own financial future are not competing goals, but two parts of the same plan. 

Written by Suzanne Berkery, Senior Portfolio Manager.

This article was written by Senior Portfolio Manager Suzanne Berkery and is reproduced as published in the Sunday Times Ireland.