The Heart of Money: Pay for Preschool or Save for College?

Question: I get paid little but love my work, and my partner and I get by. Now we suddenly have become parents to two children under the age of four. (It’s a long story…) The children came with a modest school trust fund, and I want to spend the trust fund over the next few years on early childhood education, better equipping my home for the children, and allowing me to slow down my work schedule and have more time with them. My sister-in-law, who works at a Montessori school, agrees with me, but my partner, my parents, his parents, and my friends say I should save the trust fund for college. They point out how expensive college is and how kids today are burdened by college debt. What are your thoughts?

Paul Sutherland: When I chat with teachers I often ask them much the same question, and I have yet to hear one teacher suggest that if you must choose, you should save the money for college. What teachers know intuitively and science has proved over and over again is that the most important period of growth in a child’s life is the first trimester to the first grade. If you want a child to have the best chance of a successful life, “obsess” over them in their first five years.

So how should you use this money? For some, extra money allows a parent to stay home and help with raising a young child; for others, it pays for a high-quality, loving, intentionally created and managed preschool. For most, success is achieved by a combination of preschool, family, friends, and stay-at-home parenting. Whatever you choose to do, the preschool years are the best time to spend both time and money on your child. Research by James Heckman, Nobel Prize–winning economist and early childhood researcher at the University of Chicago, shows that every dollar spent on early childhood compounds at 13 percent over the life of the child. This makes sense. If you raise a child to be loving, compassionate, curious, to have grit, persistence, optimism, and to be happy, your child will be equipped with the tools to create the world she wants—and with the drive to succeed.

Dr. Heckman’s research also shows that a high IQ doesn’t make much difference in how kids turn out—it may make a difference in 1 or 2 percent. We all know super-smart people who can recite the Bhagavad Gita and tell you who Ginger was on Gilligan’s Island, and yet have no career. Despite earning university degrees, they don’t have the social, emotional, and spiritual skills to succeed in everyday life. And with 90 percent of the brain and connection skills being developed before age five, it is fairly clear to see that the time to be smart about raising a child is when they are young.

Heckman has also found that the high school dropout rate is increasing in America. That is not really about high schools’ failings so much as it is a sign of problems early on.

Certainly, I believe that college is important, and I understand that the rising costs are frightening. You want to save what you can. The point is, if your child is raised in a safe and happy education-oriented environment, he will want to go on to further his education—and you will figure out how to do it when the time comes. If all the trust money is gone and you have to scrape together scholarships and student loans, and your child has to work summers and weekends, that’s okay—and in some ways better. We value an education that we have to work hard for far more highly than one that was handed to us by a rich uncle’s trust fund.

So, my advice: Follow your values and spend the money to allow you to do what is best for your “instant” family. If you want more help with raising happy, spiritually competent, inner-directed, successful kids, read Margot Sunderland’s The Science of Parenting and Paul Tough’s How Children Succeed.