Private education - finding the fees

Private education isn’t cheap but that doesn’t mean it’s only an option for the seriously wealthy. Most parents with children at independent schools today are paying their fees out of earned income, family savings or from a loan offset against the value of their property.

If you and your daughter think she’ll thrive at an independent school, do your research: check exactly what the level of fees is and what payment schemes are available. You will find that school fees vary enormously from school to school and that many schools offer bursaries and scholarship.

You can pay school fees in advance each term, or by monthly direct debit. If your personal circumstances change and you realise that you will no longer be able to pay the fees it is important to talk to the school immediately. Many schools will be able to make an interim arrangement with parents to spread payments in cases of short-term difficulties. If you have to withdraw your daughter you must give a full term’s notice or pay a full term’s fees in lieu of notice.

If you’re lucky enough to have a large capital sum available most schools operate a ‘fees composition scheme’ whereby you can pay several years’ fees in advance at a fixed price, and get a fee discount. Some parents use flexible borrowing schemes to fund school fees. Such schemes usually involve securing the loan against the equity in your house or against an insurance policy. Do take independent financial advice before committing to such schemes.

Some grandparents contribute towards school fees. They may well be able to take advantage of tax benefits not available to younger parents or to make payments which will reduce their potential inheritance tax liability.