Is this a financial mistake? Help please

There's a whole lot of parental judgement about 'awful' schools based on not much logic, and often a big dose of snobbishness! I wonder if the OP was privately educated themselves? This sometimes seems to breed worries about the state sector. In most areas there are a few primary schools to choose from, and it's unlikely they're all awful. Schools are always a mixed bag of good and bad points, plus they change fast. One school near me had a poor reputation a few years ago, a new head came in and with strong leadership, decent behaviour systems, and support from parents things changed fast and now it's hugely oversubscribed. I think it's a bit early to be worrying about every school in the area being 'terrible' if a child is two. I became a school governor at my son's school, and it's a great insight into how schools operate, and a chance to help from within. Spending money on private education is such a waste, especially at primary level

Don't waste money on private primary school. You are not earning enough to comfortably afford it and in my view is not worth the precarious situation you'd be putting yourself in.

An ISA is not an investment per se. You need some decent financial advice if you're going down that route.

Personally I'd use the money to move to a better area.

No one can know what will be best for you without knowing about your mortgage or any other debts you may have.

If you still have a mortgage on a peanuts 0.5% rate, and no other debt, then £20k in Plum's ISA, and £60k in Chip's savings account (from MSE)

If you have CC debt up to your eyeballs, and on a 6% mortgage rate, then the advice is very different.

I definitely wouldn't be looking at private schools with that limited inheritance on your salary.

You definitely can't afford to pay private school fees with 80k from nursery or even primary age. I would talk to a financial advisor about the least risk / most return for your money to invest for potential private schooling at secondary level. That could also include your savings and anything you can save from your maintenance. It's not just the school fees when you go private, everything costs more money - uniforms, PE kit and equipment, school trips, expectations of clothing / phones / pocket money expenditure / birthday parties etc because they're mixing with a group of friends who come from more affluent backgrounds.
Also bear in mind that state schools can change significantly in the 2-3 years you've got until primary and 9 years you've got until secondary.

80k wouldn’t last long if you wanted to privately educate her from the age of 4 to 16.

I would pay 60k off your mortgage and put 20k in to a stocks and shares ISA.

Then have a rethink about private school when it’s time for her to go to secondary.

How much are the fees? Round here infant schools are like 20k and senior schools 30k so maintenance wouldn’t cover fees. Plus the offer of £1500 would probably be dependent on him keeping his job, not having more kids etc which is no guarantee.

As pp said, I would look at schools a short distance away (say up to 10 miles)

If I had to pay private then I’d prioritize secondary school.

You can only put 20k a year into an ISA. Any interest will be tax free but if you earn more than £1000 in interest from other high interest accounts, you will pay tax on the interest over the thousand.

Saying that, I’m no expert - this is just what I’ve learned from my own research. Might be worth paying for a consultation with a financial adviser to maximise your return on the 80k.

Spending your windfall on 4 years on private school for a child still in their single digits is foolish.

Invest a good part of that in your name, keep some liquid for an emergency fund.

What makes the schools near you 'absolutely awful'? Have you thought of applying to be a governor at one to help them improve?

I agree with others, you can't afford private education. Focus on giving your dd experiences to supplement her education when she's a bit older - music lessons, trips to museums/art galleries/theatres etc.

I'd put the money towards the mortgage, but keep a little back (£5/10k) for treats and emergencies.

I'd overpay the 10% on your mortgage that you can do without penalty, max out an ISA an then bung the rest in premium bonds. I'd then use the interest on the savings accounts to overpay the mortgage in the next couple of years.

80k wont go far on private schooling, but if you can reduce your mortgage substantially by time your child is 5 and starting school you'll have a lot more disposable income which can make the world of difference.

I would not be considering private school - to be blunt you can only afford it in the short-term and that won't be best spent in the [much cheaper] early years.

Look around for very good local state primary schools that feed into very good state secondary schools, and if required use some of the money to move so you are in catchment. Invest the rest and/or pay off some of your mortgage.

It would depend on the rates available. I would def put 20k in an isa, but that's your tax free limit for the year, so maybe try and find a high interest savings account for the rest, and/or consider premium bonds, as they are risk free and winnings aren't taxed. It also depends if you want access to the money at all or are happy to lock it away.

If I was gifted 80k I’d pay off any immediate debts and then invest the rest into a house I could rent out/gift to dd when she wanted to move out if it would stretch that far

You can’t afford private school. Have you properly investigated schools and what they’re like a few miles away? Moving a short distance should open up other schools to you, whilst maintaining links to your family.

But you would get £18k in maintenance a year, so you’d have to pay the rest out of your income and also all the extras on top too. And the fees will go up every year by a large %. It would be better to save for your DCs future.

Invest the money for the next few years. Then when your dd is looking at secondary schools you can use it to move to an area where the schools are better. You won't be as reliant on the support as she gets older.
It's not enough to keep her in private secondary education reliably, and you would be constantly worrying about fees going up etc. If you don't want to move when she gets to that age it would be better saved for her future - ie house deposit.

I would say you can't afford it. If you want to invest it and use it for say, her final four years that would be one thing, but I worry you can't afford the whole shebang. Using towards the mortgage or investing would give your family security.

£80,000 would only pay for 4 years of school, and fees can and do go up every year.
What exactly do the fees cover ? - lunch ? after school club ? activities ?

your take home is £2400 how much is your mortgage ?

if daddy stopped paying tomorrow for whatever reason, can you cope without his maintenance ?

I’d use the money to fund a move to an area with better schools

I'd use the 80k to for a deposit to move to an area with better schools

I would either move closer to a state school and save the money in an ISA and use the local and pay for extra tutors etc.

I did send my kids privately but wouldn't have in your position, I had some family help and double incomes.