Average annual fees for private schools reached £13,000 this year. The average day school costs £11,208 a year – and if you want to send your children to boarding school, you’ll have to spend more like £25,000.
Once you factor in inflation, the cost soars further. “Parents with a one-year-old child who intend to send him or her to a private day school from the age of 11 to 18 face a bill of more than £150,000, assuming fees rise an average 6% a year,” says Alexandra Goss in The Sunday Times. So how best to prepare your finances?
To save that sort of sum parents need to be setting aside £700 a month, says asset manager T Bailey in The Sunday Times. That’s assuming their savings grow by 6% a year and the investment ends when the child is 11. And that doesn’t even take into account all those extras – school trips, uniform and music lessons. If you are reading this while glancing uneasily at the ten-year-old you were hoping to send to private school, don’t worry – it’s not too late to get a plan together.
First, double-check the quality of nearby state schools. If you are lucky enough to live near a good one you could save yourself a fortune. Faced with forking out £150,000 to send your child to private school for seven years, the cost of moving into the catchment area of a decent state school starts to pale. Another option if you live near a reasonable state school is to send your child there but move them into a private school for the important GCSE years.
Savvy parents focus “their expenditure in areas where they perceive weak points in their own state catchment areas”, says Rosie Murray-West in The Daily Telegraph. For example, many parents send their children to state primary schools but fork out for private tutoring on the side so that they stand a good chance of passing the entrance exams for non-fee-paying grammar schools.
If you still have the time for some longer-term financial planning, but don’t have £700 to set aside each month, start working on your in-laws and parents. Grandparents can set up a trust to fund their grandchildren’s education. Each can put up to £3,000 a year into the trust free from inheritance tax. Once inside the trust, the money is considered to be the child’s own. So growth is income-tax free as long as the child’s annual income is below the personal allowance of £7,475.
Finally, make sure that you check any bursaries and scholarships a school offers. Private schools are keen to retain charitable status, so are offering more fee help than ever before.