To be freaked out by affording (older) children?

[HelpMeHiveMind]

The AIBU here is a bit misplaced- obviously IBU to not have realised children cost lots. We've purposely only had 2 (although we'd love 3) as didn't feel we could provide everything we wanted for more. I also know millions of people manage - probably with lots less than us...we are quite comfortable although live in SE where it doesn't go anywhere near as far as it would elsewhere.

My question is more how do people actually do it when they become teens / young adults and start needing:

• mobile phone contracts
• cars
• University fees
• uni accommodation
• maybe even house deposits

The really big things, basically, that they're unlikely to be able to manage alone.

We've been saving into accounts for them since babies but initially only at £25 pm (all we could afford back then), now £100 pm. It still isn't going to touch the surface of what they'll need. And there are two of them with a gap, so things like remortgaging are problematic as can't cover one and not the other. We are also mortgaged to the hilt already.

So how do folks do it?

You're not doing your kids any favors by raising them think that what they have is unrelated to whether/how much they work.

Ummmm I didn’t expect my parents to pay for any of that! And I came from a high earning family! We were raised not to assume anything.

Parents prioritized education so uni fees were paid (and they paid just by not saving muchthe years we were at uni, ie regular cash flow). I grew up in US to drive to school in a very old car inherited from grandparents, not mine. Post uni, I saved and bought one. House deposit, DH’s parents gave us money but I had no expectation of this & we bought cheaply and with a very small mortgage. If they hadn’t, we would’ve saved & waited.

We intend to afford uni fees but not having a mortgage at that stage.

Bad news for those thinking student loans will cover university costs. The student finance system assumes that parents will contribute and loans are reduced accordingly for students who's parents earn over £25k per annum, with parents expected to make up the shortfall.

www.moneysavingexpert.com/news/2021/11/student-living-parental-contribution-win/

I'm saving £27k per child for uni fees. Have 3 so need £78k.
Currently have £12k saved, saving £800 a month (they're 12/10/8)

Have 3 buy to let houses so will probably remortgage them, most have about £200k equity. Then hope to give them about £100k (??) each. Won't be a huge amount in 10 or so years but hopefully the start of a deposit so they can buy early 20s

Decided not to do private school. Huge mortgage so overpaying £1.5k a month, on track to be cleared by the time we're 50.

Then will be able to use the former mortgage cost of £2.5k a month towards costs of kids living expenses and rent. Going to be a fortune with 3 kids 2yr apart potentially all at uni the same time.

Sounds a lot but my husband and I didn't have any help and we both work FT in stressful jobs (he has 2 jobs) and helping kids out so they have a decent start in life.

You can’t give them what you do t have, and more importantly you need to try to make sure that you are secure when you retire so you don’t have to rely on your kids for money.
Ha ing said that I now help out my dad with some bills and pay for stuff like hols for him to come along with us and don’t begrudge him a penny. He and my mum didn’t have much money but gave us a lot of time, love and attention, esp. when it came to school work, homework etc took us to the library every week, made sure we had what we needed to succeed in school.

mobile phone contracts

• those are not necessarily expensive. I pay less than £20

cars
-they can use the family car when they live at home. Cycle in uni and then get a car themselves when they are grownups. Well this is how it went in my social circles. But must depend on location.

University fees

• loans. They don't expect you to pay the tuition

uni accommodation
-they get a job and you help as much as you can

Maybe even house deposits

• parents giving money for deposits is something I've only seen in the Internet but it's not mandatory. Contribute if you can.

@Francounder

£500 a month! Is that a joke figure? We would only get the minimum loan but couldn't save anywhere near that figure.

That's what you need to be prepared for. We've had to support three at uni over seven years, with two there together for three of those years, so costing us either £500 (for one) or £1,000 (for two) per month more or less to cover their accommodation. It's like having another mortgage, but deemed through the means-testing to be affordable.

It’s the car and the uni that keep me awake at night. We live somewhere without public transport. Everyone drives. No easy way to get home from school if you miss the school bus, not walkable.

I’m in the US ans was talking to my dental hygienist yesterday, her child going to in state college for public health degree will cost 250k (fees, halls and food). Oh how we laughed! They’re also immigrants and are gobsmacked, been here the same amount of time as us. Not our kids choice to live here so I feel responsible for their fees. Hopefully I’ll be back in work by the end of this year and can start putting away some serious money for them. H of course buried his head in the sand and I’m sure doesn’t lose any sleep over it

@bringiton2022 I would think twice about paying tuition upfront.

It's likely that your DC will never pay back all the loan and the rest will be written off, so you're wasting money paying tuition IMO. Better to use it for accommodation/cost if living or housing when the time comes.

Was there a reason why you are wanting tl pay tuition?

[quote WutheringTights]Bad news for those thinking student loans will cover university costs. The student finance system assumes that parents will contribute and loans are reduced accordingly for students who's parents earn over £25k per annum, with parents expected to make up the shortfall.

www.moneysavingexpert.com/news/2021/11/student-living-parental-contribution-win/[/quote]
I earn minumum wage and am a single parent so DS will get help. Should he choose to go.

*Maybe even house deposits

• parents giving money for deposits is something I've only seen in the Internet but it's not mandatory. Contribute if you can.*

I think this depends very heavily on your social group and area - everyone I know my age (34) who owns does so in London or the South East and every single one of them had family help. People often aren't upfront about it, though.

Was there a reason why you are wanting tl pay tuition?

Look at the scope the government has for changing the T&Cs. Think about how broke we are nationally. Think about how it would be desirable to have more students paying off more of their loans.

Yes, it's a good deal right now. But it's not a future proof one

@Alysskea the min amount for repayment is hardly anything - £23k?

My husband and I both earn over £100k, after spending a fortune on their activities, supporting their education and spending approx £45/50k (??) on uni I'd be gutted if they couldn't earn more than £23k a year! Maybe if unwell ?

I think it's a false economy treating loans as a tax and that Martin Lewis is wronf, esp now the government just sells the loan book on and interest rates are 5/6% - effectively students are trapped with a costly product.

I think FCA will intervene at some point. It is not a fair market. Commercial loans are cheaper after all!

Yes, I am in South east expensive city tbf and our friends are agr range 36 - mid 40s all had help and quite substantial in some cases from parents. If older so DDs friends parent some early 50s but still have kids in primary school, they have moved down from London areas that they could afford in their 20s but we could not have done as even 5-10 year changed that.

@bringiton2022 that's not the case for everyone, I have a degree, a masters, 18yrs experience, in a job that requires me to use these skills, if I was full time I would earn £32k. It depends on career choice. I don't know anyone who earns £100k.

@Indecisivelurcher I'm not expecting them to earn £100k necessarily it's just I don't know anyone who earns under £23k well or under around 40/50k tbh in London

[quote bringiton2022]@Indecisivelurcher I'm not expecting them to earn £100k necessarily it's just I don't know anyone who earns under £23k well or under around 40/50k tbh in London [/quote]
So you don’t know anyone who works in home care for example? You don’t know any classroom assistants?

The threshold for repayment is more like £27/28k but unless you earn quite a bit more than that, the repayments are tiny, a few quid a month.

But I don't know how you can say you don't know anyone who earns under £40/50k, most nurses and teachers earn less than that, despite being graduates. You'd have to have an extremely limited circle to only know high earners, and pretty much walk around with your eyes closed.

My kids mobiles are £10 a month unlimited everything.

Driving lessons we will purchase them for their 17th or 18th birthdays and will get them a car too. We will put money aside for this. University we will probably supplement them for food but lodgings and fees will have to go on a student loan and they'll need a part time job like almost everyone else. House deposits- that's one we've agonised over. We won't have the money. I've wondered if it's worth buying a small flat now and them all having their "turn" with it while they save. But then I'm not sure we have the funds to do that either.

Thank you for sharing that excellent article @WutheringTights (great name BTW!). This is definitely my biggest worry and I am a little taken aback at all those assuming full loans will be given. A household income of 60k which cuts the loan to half is really NOT massive in the South East. We do not live in a large or plush house (a few people have suggested we downsize to reduce the mortgage), but that sort of household income does not leave much room for plugging the shortfall for 2 x DCs through uni and while I certainly agree that they should work for phones (and maybe even cars), I'm not so convinced about paying for their own education. I think realistically we'll need to encourage them to choose unis where they can live at home and commute.

Yes, we know that, but you don't need to save £500 a month every month from birth onwards in order to fund Uni. Saving for house deposits is a whole other ballgame however.

Sorry, that wasn't to you OP, it was to the person saying £500 a month was a realistic figure. Phone cut off the quote.

@HelpMeHiveMind

• mobile phone contracts (sim only under £10, don’t get a phone on contract)
• cars (they get a job)
• University fees (student loan)
• uni accommodation (student loan, maybe you could help)
• maybe even house deposits (they get a job)