Your children’s education is one of the biggest ways you can shape their lives. And it’s the reason why many people choose to invest in an independent school education, rather than their home, or themselves.
Many clients ask me to prepare a cashflow forecast to see if they can afford a private education.
But there are quite a few things to consider if you want an independent school education for your children. Let’s look at that in more detail…
What age do you want to start?
You can access independent education from nursery, but most parents tend to consider it from age 4 years and upwards.
The benefits of starting at primary school age are that you have embedded the foundations and culture of independent education from the beginning. Your child can benefit from the smaller class sizes, more individual support and teaching, and the opportunities.
There are a lot of choices for independent primary education. Schools providing education from 3 to 7 or 8 years of age are known as pre-preps or pre-preparatory schools. Those providing education from 7 to 11 or 13 years are known as prep or preparatory schools. They are called this as the intention is to prepare the children for the move to secondary education, and GCSE high achievement.
Alternatively, you can move your child into the independent sector from age 11 to focus on GCSE and A level attainment. This is seemingly the less expensive option, but the cost differential between primary and secondary independent schools can be quite substantial.
School fees vary considerably. Partly based on geographic location – no surprise that Central London is the most expensive area. Whether they are going to be attending as a day pupil or boarder will also obviously affect the price.
What else do you need to consider?
The costs of private education are not just the school fees. School uniform alone can be incredibly expensive. Then there is the expected additional equipment and all the extra-curricular activities. There are usually more overseas trip opportunities, as well as offering a much wider selection of sport options.
You will want your children to fit in, and not feel that they are missing out, so you will need to ensure you can afford all the aspects of school life, not just fees.
How do you choose the right school?
There are many websites, including national newspaper league tables and opinion articles, dedicated to helping you choose the right school.
Your choice is likely to be partly dictated by geography, as well as academic achievement, and cost. Equally, your own philosophy and upbringing. You may want to ensure your children are brought up within your own religious faith, so will look for a school under that denomination.
How can you fund an independent school education?
There are several options. However, you do need to be aware that school fees are subject to inflation – and that’s normally quite a bit higher than the standard rate of inflation!
ISAs can be an option. They will you give you easy access to the money when you need it, but investment ISAs are not without risk, and you will want some assurance that they can meet the costs you will incur.
Flexible mortgage – this does require some planning but if you overpay in the early years, you can then access those overpayments at a later date. It does secure the money, and it is unlikely you will achieve better interest on savings than the cost of your mortgage.
Enterprise Investment Scheme – this can be a very tax efficient way of raising cash over 3-4 years with tax relief of 30%. You can have a rolling scheme every 4 years and can reinvest. It is not guaranteed, and there are risks, but is worth considering as another option.
If you are serious about this, the sooner you make the decision the better. Not only do many of the most successful schools have a waiting list that means you need to put your name down before your child is born, but it also allows you maximum time to save.
Go into this with your eyes open. It is not cheap – most school fees start at £10,000 per annum without extras, and that is at the lower end of the costs. You don’t want to start your child in secondary education and then realise the costs are too prohibitive and have to unsettle them in the run up to GCSEs.
If you would like to do some financial modelling on independent schools for your children, please contact me on 01344 875 310.