It doesn’t take a financial expert to tell you that independent schools burn a hole in any parent’s pocket; according to Lloyds bank, school fees have risen more than 20% since 2012. But it’s not just independent schools that will cost you either; behind purchasing a home, having a child will likely be your largest expense.
However, as only 7% of Brits go to schools that require fees, clearly independent schools present the most daunting challenge to family finances.
All experts agree that the smartest thing you can do is be prepared. Know the annual fees for your ideal school picks: most independent boarding schools will average £25,000 to £30,000 a year, with most London day schools around £16,000 per year. However, the top-tier London schools such as Westminster and St Paul’s have annual fees comparable to independent boarding schools. You should also consider how tax can work for rather than against you. The Individual Savings Allowance permits a parent to invest £20,000 in the tax year, and that investment will be free of tax. You can then draw on your ISA without worries of tax deduction. Junior ISAs, which allow parents (or grandparents) to invest on behalf of children, are also available. Such options are useful for those thinking further down the line – the money saved in a Junior ISA is only available for access when the child in whose name it is established reaches adulthood. £4,128 is the most one can invest in a Junior ISA per annum.
Saving for a child’s education can often be a family affair. For example, a grandparent is allowed to pass on their income regularly as gifts without the deduction of inheritance tax, provided they survive seven years after making the gift. Many families have a pot, into which several years of tax-free income is gifted, which will become a child’s education fund, for secondary school and beyond.
There are also ways in which schools will help you out that they might not advertise. For example, many elite primary schools will discount fees for the entry of a second child or third child, so consider keeping the siblings close together! This sort of reduction will almost certainly not appear on the ‘annual fees’ section of a school’s website, but it doesn’t mean it’s not there. Parents can use the Show as a chance to inquire with heads of admissions about their policies regarding siblings.
The most useful tool to parents concerned about the cost of their child’s education is a thorough investigation of bursaries and scholarships. Julie Robinson, general secretary of the Independent Schools Committee, said that 5,700 students received full bursaries in 2016. Most independent schools will offer sports scholarships and academic scholarship, but these will not necessarily make a significant difference in annual fees. Susan Hamlyn of the Good Schools Guide says that a third of pupils at independent school receive financial help in the form of bursaries. You can expect any highly-selective or mixed-ability range boarding school to have a page on their website with information regarding bursaries.