This study examines how the timing of parental income across different childhood stages influences educational outcomes in Japan. Using longitudinal data tracking children born in 2001, we analyze the differential effects of parental income received during early childhood (ages 0-6), middle childhood (ages 7-15), and late childhood (ages 16-18) on post-secondary education attendance, university enrollment, university-major prestige scores, and elite program admission.

Our findings reveal that parental income during late childhood has a significantly stronger association with educational achievements compared to income received during earlier developmental periods. This pronounced effect is explained primarily through additional spending on cram schools (juku), which play a crucial role in preparing students for Japan's highly competitive, centralized college entrance examinations. While parent-child communication quality remains important for child development, it does not account for the observed relationship between late-childhood income and educational success.

We also document substantial peer effects, with children from higher-income families systematically more likely to attend schools where peers demonstrate stronger university aspirations and achieve better outcomes. However, even after controlling for peer influences, cram school expenditures during high school remain the primary mechanism linking late-childhood parental income to educational attainment.

These results highlight how institutional contexts—particularly examination-based university admissions systems—shape the relationship between family resources and educational opportunity. The findings suggest that policies targeting financial support for supplementary education, regulating cram school operations, and promoting socioeconomic diversity in schools could help reduce educational disparities stemming from family income inequality.