To use inheritance to pay for private school?

[Pondformarch]

We have a two year old and are due a second baby this summer. Our combined income is around £120,000, a bit more with a bonus.

My parents died when I was young and I inherited a flat. It is now worth around £125,000, not a fortune, but it would pay for private school fees.

I always had it in mind to send one child but finding out I was having a second made me think the fees would be too tight. Wondering if selling the flat might be most sensible. This is a fairly small school, not a big name one (obviously) fees for senior school are around £15,000 p/a. One of the main reasons I would prefer the private school (apart from local state choices not being brilliant) is the fact that wraparound care is really high quality and it would mean that we wouldn’t have to worry about pick ups and drop offs. Also, the school is right by my workplace, which helps.

But I also know it might be better to hang onto the flat long term. So interested in seeing what others think?

I wouldn't. I'd rather use the proceeds of the flat as a deposit for their first properties. If i could have comfortably covered the cost of private school plus all the extras that go with it i would have. Going to private school does not guarantee high flying careers in my opinion. I know a few people who have been to private schools & have not turned out any better than me I'm terms of career & lifestyle.

I’m not really wanting to go down the private tutor route to be honest - especially at primary. I definitely want academic success, if only to make life easier, but it is more than that. A lot of the schools here are absolutely enormous - our catchment secondary has over two thousand students - and I like the thought of them in a slightly calmer environment!

Working FT would be difficult to manage with the state route as well and there are pension considerations to PT (although obviously the other side of this is that most of my salary gets swallowed in school fees!) But knowing they are safe and cared for would be a huge weight off my mind. It would also even help with the school run as I could literally drop off and then drive round the corner and I’m at my workplace.

There is a lot to think about - weighing up ideas.

I would do this in your shoes. With your combined incomes and the £125k you could just about do it, but you'd still have to be saving from income to provide for later years. Starting now relying on only the £125k would be a disaster as that is nowhere near enough to cover 2 x private educations.

We recently looked at the costs of private school in our area - similar sort of cost to that which you mention. We did a spreadsheet putting in each year group's current fees and allowing for 6% increase in fees each year. It worked out about £325k for 4-18 (for one child).

Sell the property and put funds in S&P500 tracker for No2.

Focus on No1 out of current income and bonuses. That's all you need to do. It will work.

We've used an inheritance to move dc from state to private without any lifestyle changes. No regrets at all. I volunteered a lot in dc's state school reception class and I knew it wasn't able to get the best out of him despite a fantastic teacher who he loved. If you can, I would.

For two children then, just short of £300,000, which is a lot of money.

You’ve only got less than half with the sale of the flat.

How much would selling your other property get you?

It sounds much too tight to me, and I would not want to be solely reliant on my DH’s salary.

But you sound quite emotionally invested in it, so I’d look at something like state for primary then reassess private at the point your DC2 needs to be schooled. Lots can change in a few years.

Yes, the flats worth now would not pay for private school for two.

I realise that the fees will go up, but I can only go off current prices and estimate based on that.

FT salary for me is £43,500 (I am on less than this as I am currently part time.) DHs salary is just over £80,000, plus he has an annual bonus which is around £7000 if he gets it - been a bit funny the last couple of years due to pandemic.

So I take home around £2500, or £30,000 p/a - at senior school, two children at private school is £30,000 a year. So it is doable even without selling the flat, but obviously at the moment costs are at the forefront of everyone’s mind.

One of my DS’s was at an independent school from year 4. It was because he’s autistic but if I could have my time again and I could afford it, I’d send both my DS’s to independent schools.

Honestly, they’re like a different world and your stress levels will be so much lower. The staff are nice to the parents, they reply to emails, take you seriously, don’t hassle you if your child is off sick, treat you with respect. The kids stay in the same class throughout so form a bond with classmates. This makes it far easier for children who don’t make friends easily.

I didn’t find the uniform to be much more expensive (it was slightly more expensive but far better quality) and sometimes they even have second hand uniform sales. They don’t assume that all parents are very well off. Well the one my DS was at didn’t….obviously they vary.

They're not perfect and I know of some children who have been bullied but for us, it was a very positive experience.

By the way the suggestions about the investment are really helpful, if anyone wants to tell me more that’s welcomed (but I can google of course!)

I'm sure you have, but take into account inflation of school fees, 7% per year. Plus the impact of loss of charitable status.
£125k sounds tight for two.

I wouldn’t pay for private primary abs up until last year I would say definitely secondary is worth every penny but my views on this have changed somewhat.
DD is at private secondary in year 10, she went to state primary and over half of the girls in her year were in the juniors, but she settled in fine and has a great range of friends, some who have been there from the juniors and others who were new with her in year 7. We have stretched ourselves to do this but it’s worth every penny, she is absolutely thriving and it is a brilliant school.

DS is two years younger and obviously we wanted to give him the same opportunity. DD is at an all girls school so he couldn’t go there so we found another with amazing sporting provision which is what he excels at. He hated it. Constantly acting up and getting in trouble, absolutely exhausted from being out of the house 12 hours a day and struggling with the work, constantly feeling he was not good enough. Also the materialistic attitude of his friends was awful, I met several of them and all they could talk about was who had the biggest house, the best car. At 12 years old. He begged me in the summer not to send him back in September and is now at our local state school loving it with all his friends, like a different child!

Sorry this is so long, what I am trying to say is the right school for the right child is worth every penny but private is not the best option for every child!

Why not move to an area with decent state schools? Then then the money would still be yours.

@Dreamsoffreedomjoyandpeace I know - I think state schools do their best but I also know how limited our ‘best’ is in a way. It’s just not a great time for public services generally.

1. This is above mumsnets pay grade - literally. It's a lot of money, far too much to trust to Internet amateurs. Find a decent financial advisor.

2. The state of play now is unlikely to be the state of play when your kids start school. I would be surprised if we don't see a wave of private schools going bust in the next year - energy bills hurt - and those that will left will raise fees. As much as you can delay tge decision.

3. If you hate managing a rental property a decent financial advisor will be able to suggest other places to put the money. Those decisions do not have to be related
   However I would be very careful about selling now when prices are about to dip.

@Iwantmyoldnameback i think because we do actually love our home, it is very rural with lots of land.

Moving to somewhere with decent state schools is not out of the question but I’m not convinced it would solve the issues relating to wraparound care and convenience of just being able to go to work with the children and get them on the way back!

That’s hard @Coasterfan , I’d certainly hope to avoid those sorts of attitudes - it’s hard isn’t it as you don’t always know. All I can do is look around and ask questions and see for myself.

We put three though private school from nursery to sixth form. It was a great school, they were all happy and thrived and did well academically BUT now property is so expensive in relation to earnings I sort of wish we had instead invested the money and given them all a big lump sum at 25 to get on the property ladder. I actually think that in the current climate that would be more of a lasting benefit.
Of course it depends on your child and the area you live in .

What’s your current childcare situation and what will it be with DC2 when you go back after maternity leave? Then how will that change when DC1 goes to school (state or private)?

So is nursery near school (and work) or near home? etc.

Logistics of 2 are really hard! So you can’t make the decision on DC1 school in isolation of what childcare will be for DC2.

The fees will go up over the many years

i have a friend who paid for all three kids the whole way through

theyre all lovely but not going to set the world on fire and it’s likely that none of them will end up being the high earners thst their father was (of course who knows).

they’re not so fantastically wealthy that they’ll be able to help them with deposits.

i think it probably would have been of more benefit to give them the money for a deposit tbh

i would have though wraparound care could be sorted for a lot cheaper

I think you’re actually at least in part motivated by how annoying it is to manage the flat. Which I very much get. In which case sell the flat and out the money in shares and see how you feel in a few years

(I’m focusing on childcare issues as this seems a particular stress point for you in considering the private school near your work).

£125k is not a lot for 2 children Blimey , that would give a take home pay of approximately £78,000 , how the hell is that not a lot? That is about £40,000 more than what DH and I take home. Wasn't aware we were so poor🤔

Go to someone like Hargreaves Lansdown and split 5 x £25k across their various global funds. Needs to have a US slant - only economy that has critical mass and efficiency next 10 years. Put £25k or £50k into Fundsmith.

Ignore the Woodford news. HL are now over that.

I think PP meant £125,000 lump sum is not a lot for 2x children’s 4-18 education overall (28 years of fees). Not take home pay.

In your situation I would consider state until 11 then private for secondary.

Is your DH as invested in private school education as you, OP? You both need to be on board equally as it’s such a hefty financial commitment for so many years.