Paying for private schooling could soon become even tougher than it already is. The Independent Schools Council (ISC) has warned that the “vast majority” of parents will pay more as private schools offer more bursaries for poorer pupils to satisfy the Charities Commission. Average ‘day’ school fees already top £10,000 a year, says the ISC, with boarding school costs over £23,000. Yet fees are still set to rise by 3%-4%. How can you cut costs?
One option is to pay fees upfront. A typical discount would be 3%, although the further ahead you pay, the larger the discount – maybe up to 5%. Ask your child’s intended school for a quote. Another option to consider is schooling your children abroad. It may seem extreme, but last year, top English-language schools on the continent were averaging about half the cost of a UK private education. A falling pound has reduced that discount and there are higher travel costs to consider. But “English international schools are increasingly popular – our schools are almost always over-subscribed”, says Fiona Rogers of the Council of British International Schools.
As for finding the cash to pay for it, “remortgaging onto an offset mortgage deal”, where you set off your savings against your mortgage debt, “and increasing the loan when a current deal expires”, is one way to fund fees, says The Sunday Times’s Elizabeth Colman. But “be aware that you can usually borrow no more than 75% of the property’s value”. And you’re saddling yourself with extra debt at a time when house prices are falling, so don’t do it unless you’re sure you can afford to. Woolwich offers an offset at 2.49% over Bank rate (i.e. at 2.99% – for those with a 40% deposit, says John Charcol’s Ray Boulger).
And don’t forget to ask about bursaries. These are usually means-tested, but a third of private-school pupils had fee help in 2008, says the ISC, so it’s definitely worth finding out if you would qualify.