Radhika Gupta explains how in 16 years education in US can cost Rs 10 crore: 'Always do the...'

Radhika Gupta also shared how investing in SIP would help parents meet their child's educational expenses in the future.

Edelweiss Mutual Funds MD and CEO Radhika Gupta recently shared that she's planning to build a Rs 8 crore to Rs 10 crore fund for her two-year-old son's higher education. But when social media users reacted with cynicism at Gupta's projection, she sought to explain how US education inflation and currency depreciation in the next two decades would result in the steep rise of education costs in the country.

"I've got a bunch of baffled messages about how education can cost Rs 10 crore," Gupta said on Tuesday. Elaborating on the math, she explained that the current cost for higher education in the US is estimated to be Rs 2.5 crore. With an inflation rate of 5 percent and a currency depreciation rate of 4 percent, in 16 years, when her son Remy would be old enough for higher studies, the academic expenditure would amount to Rs 9.9 crore.

"We underestimate the impact of inflation when we do our financial planning, not just for education but even retirement," the Edelweiss Mutual Funds boss said. "Always do the numbers and plan early!"

I've got a bunch of baffled messages about how education can cost 10 cr.The math is simpleCurrent 4 US education: 2.5 crInflation: 5%Currency depreciation: 4%Time: 16 years2.5 * (1.09^16) = 9.9 crWe underestimate the impact of inflation when we do our financial
Radhika Gupta (@iRadhikaGupta) May 20, 2025

In a separate post on X, Gupta said that although she shared the math for how expensive higher education in the US would become in 16 years, it is applicable for India as well.

"Everyone can have their own view on where kids should study or whether education will be relevant at all. An India undergrad + masters btw is also Rs 80 lakh to Rs 1 crore in today's terms. Maybe 30 percent of US costs. This math matters for everyone!" she said.

Gupta also shared how investing in SIP would help parents meet the expenses in the future. "What's the amount we are SIP-ing for this goal? Rs 1.6 lakh a month as a working couple. What's the total capital we will put over 18 years? Rs 3.5 crore. Where is the balance Rs 6.5 crore coming from? Time and compounding. Make a spreadsheet with 12 percent assumed returns and watch the magic," she said.