For some parents, the thought of paying for private education fees can be daunting and the years come around quicker than expected. Fortunately, with planning, there are plenty of ways the hurdles can be overcome.
You will start to realise that you might have to cut back on certain things, such as prestige cars, shopping trips or holidays! However, if you don’t want to cut back on these luxurious things or you simply can’t currently afford for your child to have private education, there are other ways of making it affordable for you and your family.
Statistics show that the average cost for a pupil is £33,000 per year this is excluding the extracurricular activities and uniform that they require. (Source: ISC-member senior boarding schools)
The increase in fees seems to be going up on average 3.4% yearly. This figure shows that if you have multiple children you are wanting to send to private school, the cost will be vastly higher when the second child starts attending compared to when your first child attended.
If your child is lucky enough to get a scholarship or a bursary, then this can range from a 5 – 80% contribution. This reduces the price of the education vastly for the parents which is making it a lot more affordable for families but getting a scholarship for your child isn’t very common.
So if this isn’t the case, there are multiple different ways of paying for your child’s education.
- The first one is simply paying out of your annual income. This is the simplest way of paying if you can afford to. With fee’s being almost £9K a term, which results in just under £3K a month, this can leave families with very little to live on a month, even if a family have £150,000 of annual income.
- Saving and investing your money five years prior to when your child will be starting school, and getting a 5% return, will drop the fee price significantly. It’s not an easy process but its more manageable and makes it more affordable than paying out of a salary that has been taxed.
- The next option for your family is that you invest a lump sum. However it is worth noting not all schools allow this, but when they do, the return that you gain is tax-free.
- Paying with family contributions, if you are fortunate enough to have grandparents or relatives in the family that are able to do this, and are prepared to help with the education fees, this is another option. There are plenty of ways in which they can do this, one being giving up £3,000 each year tax-free which will use up their gift allowance for the year.
If you want more advice on any of these tips and how you think this might work for you, feel free to contact us today.