How 0% interest cards helped me lower private school costs

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I’m a points and miles guru by nature. I do my best work making extravagant travel expenses cost next to nothing, like on my recent Australia trip. However, I’m also a father, and I’ve run into an expense I can’t wave a magic wand at — my child’s tuition expenses.

Still, I’m always up for a challenge. I wanted to do all that I could to defray these costs, so I had to think outside the box to determine the best way to maximize credit card rewards on this unavoidable cost. In the end, I decided to go with an intro APR card for this spending. Here’s what sort of payments we were facing and why this card was the best choice.

Assessing child care costs

One of the most expensive costs of being a parent is child care. Whether you’re paying for daycare or tuition, you can expect the cost of raising your child to be significant. These costs can quickly drain your budget and savings, even before taking into account the ongoing inflation issues.

When my wife and I started planning for children, the cost of child care was an issue we considered well in advance. With the state of our local school system, it was important to us to be able to afford private schooling so that our children could get the best education. We reviewed a few factors to determine how we could do this:

After examining these figures and with lots of careful thought, we decided that having one child would be our best chance to achieve this goal.

While this difficult decision isn’t for everyone, it felt like the best path towards achieving our educational goals without completely sacrificing our personal goals or being forced into difficult future budgeting decisions. It was the right move for us. Now let’s fast-forward to how we decided to best pay for this sizable expense.

What were our tuition options?

After going through several application processes for our future kindergartener (and recovering from the sticker shock of tuition costs), we settled on our school. When summer rolled around, the school presented us with three payment options for our five-figure expense:

• Pay an equal amount divided over 12 months
• Pay semi-annually (half upfront) and receive a 2 percent discount
• Pay in full before the start of the school year and receive a 4 percent discount

While the easiest to manage with our budget would be to pay monthly, receiving the 4 percent discount would amount to approximately $1500 in savings. Since we’d have to pay this expense anyway, I figured the best option would be to find a way to pay in full to lock in the savings.

Finding the ideal way to pay

My priority was to make the whole payment to the school and then sort it out on my end after the fact. I knew I could use my credit card knowledge (and arsenal of credit cards) to buy the time I needed to manage the cost appropriately. Looking at my finances, I estimated that a year would be a manageable timeframe to handle the expense.

While the ideal choice would have been to get a card with a high welcome offer and pay that way, I’d still have to foot the bill in full, which would be too much to handle all at once. Thankfully, there’s a credit card for nearly every situation and after a little thought, the way forward became clear.

How a 0% interest card helped

Taking a large chunk of money out of our accounts would undoubtedly impact my ability to pay for many of our necessities, so I decided the best course of action was to open a zero-interest card. Such a card would allow me to finance the massive tuition expense more comfortably into our budget and prevent further dipping into our savings.

Of course, there are pros and cons to zero-interest cards. I’d have to pay back these expenses within the stated timeframe to avoid falling into a debt trap. This isn’t always easy: 54 percent of people with credit card debt say it’s become harder to pay it off over just the past year.

To avoid missing payments, I examined the timeframe I wanted among available intro APR cards, as well as other secondary perks, like the reward rate on purchases, the welcome offer and the long-term potential of the card in my wallet. For my situation, the card offering the best blend of these features was the Wells Fargo Active Cash® card. The card offers an intro APR for 12 months on new purchases, a decent welcome bonus and a solid 2 percent flat-rate cash back.

By charging our tuition to this card, I’ll be able to pay the balance in equal installments so that it’s entirely paid off by the end of the 12-month timeframe. By choosing this route, not only did I lock in the 4 percent tuition discount, but I also earned 2 percent cash back and a welcome bonus. Since I wouldn’t earn any category bonuses from this expense elsewhere, a card with a high flat rate and an intro APR was the ideal option for me.

The card’s high flat rate also makes it a solid addition to my wallet even after I pay off my kiddo’s tuition, so I’ll definitely use it for spending that doesn’t earn a bonus on my other cards going forward.

The bottom line

Raising a child is expensive. Finding indirect ways to save money on major expenses for your child, like tuition, can help you manage your budget more effectively. If you can’t pay the expense in full right away, the right zero-interest card can give you the breathing room you need to cover the cost while ideally providing decent rewards in return.