Follow the Money

Find out why international schools are so expensive

I often hear parents comment on the high price tag of sending their children to international schools. Many times these parents are expats coming directly from their home countries where their children attended public schools for free. The concept of paying for schooling, except through taxes, is foreign to them. So naturally they ask where the money goes, what it is used for and how does that benefit their child.

A good rule of thumb for established international schools is that 70 to 75 percent of the budget is dedicated to salaries and benefits. Highly qualified teachers with many years of experience need to be fairly compensated for their experience and education. Schools in HCMC compete at international hiring fairs with schools within the region for the same teachers. Many teachers want to work in Asia but are not necessarily concerned about whether or not the job is in Vietnam or Malaysia, therefore a more attractive package helps to lure the teachers to HCMC. There is an old expression, “If you pay peanuts, you get monkeys”. Researchers in the US use Value-Added matrixes to determine the long-term effects of having good teachers. They discovered that students with better teachers were more likely to get higher test scores, go to university and even earn more as adults. In today’s competitive global marketplace these are advantages every parent hopes to give their child.

piggy bank with graduation cap

The field of education is developing and just like in many other jobs there are new innovations and new research which demonstrate better ways to reach all students. In order to ensure that their teachers are learning about these innovations or best practices schools need to bring in outside consultants or send their teachers to courses or seminars outside of school. This is called professional development and good schools will invest upwards of three percent of their budget in it. Not only does the teacher who directly attends the workshops benefit but they bring that knowledge back to the school and share it with their colleagues. This then has a school wide effect on the learning of all students.

Budgeting for the Future
Having great teachers, and ensuring that they are up-to-date with best practices only goes so far if the teachers do not have the proper instructional materials, teaching supplies or books in the classrooms and libraries. It is a difficult and lengthy process to source quality foreign language resources in Vietnam so many schools are forced to go overseas to obtain them. This can sometimes double the price.

International schools often reach beyond the scope of just classroom education and provide students with a multitude of co- and extracurricular activities. This means that schools are required to be equipped with gyms, libraries, computer labs, swimming pools, playgrounds, etc. These facilities need to be constructed and maintained. Operational and maintenance costs are on average between five to 10 percent.

bottom-picture

In light of the difficult economic situation in Vietnam today many schools will build a reserve as protection from downturns and decreases in enrolment. Because of recent changes in the laws, foreign-owned international schools are heavily dependent on expat students and so if the local economy does not attract foreign investment the enrollments can be negatively affected.

The final piece used for determining the tuition is whether or not a school is for profit or not. For-profit schools, just like businesses, need to pay dividends or share profits with their investors. The amount or percentage paid out varies by school. Not-for-profit schools reinvest all of their surpluses back into the school.

Many schools share this budgetary information with their communities through things like their Annual Report. Parents looking to enroll their children in an international school should ask about the budget as part of the initial school visit.

Bio: Katie Rigney-Zimmermann B.S, M.B.A, M. Sec. Ed, is director of Admissions and Marketing at Saigon South International School in Phu My Hung.

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