100k to spend on DC's education but how?

[mustbeabetterwife]

First time post here, but a very long time lurker on the education board.

DH and I have some inheritance money (£100k) to spend specifically on our DC's education. The money has been given to us on the promise that it is only to be spent on their schooling.

DS1 is 3 and DS2 is 1 but I want to start thinking now about where and how the money will be allocated.

Bit of background:

DH earns a decent salary. He doesn't want me to be too specific, but let's say more than 60k and less than 100k.
I am a SAHM. Hope to return to work when boys are at school. Will earn no more than 30k.
We have 2bed house in South East and have no plans (or funds) to move.

DH was educated privately and I state. Both went to RG universities.

DH would like the boys to be privately educated but I'm less keen. However, with a reasonably hefty mortgage, there is absolutely no chance of us being able to afford the fees.

So, how do we spend the inheritance money as specified?

Option 1 - Put both boys into prep and then transfer to state (top up with tutoring).

Option 2 - I'm not really sure on this one. Secondary school fees are 15k a year so that would only fund one son through secondary school, there are no grammar schools where we live.

Option 3 - Both boys into state primary and secondary and private for sixth form. Fees 15kpa for private sixth form, so in total for both boys to go private for sixth form - 60k. Split the remaining 40k to fund their first year of university.

Option 4 - Stick money into a high interest account (if there is such one atm!) and then 50k for each boy to see them through university. No idea though how much the fees will be though in 15 years time!

I hope this post doesn't come across as boastful, it is not my intention in the slightest for it to do so. I know we are very lucky to have this money and just want it to be spent as it is so wished.

Thank you in advance.

[FannyMcNally]

Agree with talkingpeace. There will be loads to finance later on! Uni loans won't come near the cost of rent and living expenses, especially the first year. Also expeditions and gap years don't come cheap and how lovely for them to know that whatever they choose to do, they can. Private for 6th form only really not worth it.

[aroomofherown]

I'd consider buying a buy-to-let for £100K somewhere; in 16 years time it will be paid off and you can use the rent? Just a thought, haven't thought it all through properly. Sorry if that's a crazy idea.

I agree with spending it on uni fees.

Another thing to consider is if they would like to do a Masters (perhaps abroad) then that money could be used to help fund that, not just the undergrad.

When they start to pay the uni fees back (if indeed in 16-20 years time this system is the same) then the money they pay out of their salary could be reimbursed with this money, so it stays invested for longer and only used as required.

[FiscalCliffRocksThisTown]

My parents had the same situation with me.

They used it to send me to private school at 8 when I was falling behind badly. Then back to state for secondary, then they funded me through Uni.

There is a lot to say for starting at state, if you have a good local primary ( kids friends nearby, support like neighbours can walk child to school, you pick up theirs etc.) if it dies not work, move them to private from age 8 or so. ( it is what we ended up doing due to DS1 SEN/support needed). At 11 they will be going to the nice local comp. with a tutor if need be. Then some money left for uni.

Our situation is similar to yours. We are chopping and changing depending on DC needs/available schools. The comps here get better results than the indies, so it would seem almost foolish not to try the state option for a few years first.

It is nice to have private school as a fall-back option, but even nicer if State option works well, then they can use it for uni/further education.

[Talkinpeace]

AAAAgghhhhh
"spend it on University fees"
please read up on how they work - they are not a "fee" they are a 9% graduate tax.
Only an idiot would pay them up front.

[curlew]

State school, but with every single extra they might want in terms of music, sport, trips, whatever. Really good family holidays.

And please, please don't think of university fees as debt. They don't have to pay it back until they are earning a decent wage, and any left when they are 50 (I think- maybe 55) is written off. It would be a massive waste of money to spend it on university fees.

[aroomofherown]

Talkin I explained what I meant later on - I didn't mean to pay them upfront. That would be idiotic.

[notadoctor]

I think unless your local state schools are terrible, you should them there - use the money to support extra curricular activities, trips and extra tuition if they're struggling and then help them with the cost of higher education and/ or support them through any unpaid internships they may need to do to get on in their chosen professions.

[notagiraffe]

Depends on what sort of people your DC turn out to be. If they are in the middle academically but passionate about sport or dance, for example, I'd go state and spend the money on extra tuition etc for their core interests. If they are extremely academic, I'd do as havingastress suggests and use it for private education at a selective school from 11-16 which you could then top up with your Dh's and your own income.

I'm pretty shocked that the mortgage on a two bed house doesn't leave much change from a £60k+ salary! Can you change mortgage suppliers, or move to a different area? That's crazy prices. We live in one of the most expensive areas in UK and even here, the two bed cottages wouldn't drain the majority of that high an income.

[MrPricklepants]

University. Who knows how high the fees will be in 18 years time.

[Branleuse]

if i was going to send my children to private school, id only bother for secondary school 11+, unless your local primary schools are particularly dire.
Even if you had to top up a bit towards the end, 100k towards it will sort most of it out

[LondonMother]

I agree with Talkinpeace and aroomofherown - keep the money to pay for the extras, e.g. music lessons, clubs, trips, while they're at good state schools - if necessary, move to the catchment of said good schools. You will save a fortune that way and won't need to work full-time when they are young - I agree with daphnedill that if you aren't desperate to get back to work for your own career reasons and you aren't in dire need of the money, part-time work is the way to go.

Then use what's left to pay for the living expenses (not the fees if the loan model is similar to what's in place now) in the first years of adult life while they're at university/training, especially if they end up doing a postgraduate qualification. Who knows what model of higher education funding will be in place 15-20 years from now, but it's hard to believe that it's going to be any more generous than it is now. The position now for anyone wanting to do a Master's is that the fortunate few get full or substantial partial funding through the research councils but most people have to self-fund which means taking out career development loans, working part-time or full-time while studying and accepting help from family.

[mustbeabetterwife]

I don't think spending it on a larger property for us or a BTL would be right. I can understand the economic argument and value of it, but the money is really to be ploughed (directly) into the boys education.

Besides, they can share a room for the next 10 years - it'll be fine, we were a very poor family, all shared and loved it!

Thank you again for all your thoughts and suggestions - this is exactly the type of conversation one could never have in rl, so it has been very helpful to post.

I think (as things stand now) I'll start them off in state primary - a couple of lovely ones near us, but maybe just outside our catchment, so may need to rent our house out and we rent to be in the catchment area...I'll need to investigate that further asap...

Anyway, by the time they leave primary, I will have a clear indication of what subjects they do (or don't) flourish in, what hobbies excite them and what their passions are. Then we'll just see what the next natural step is for them, maybe state with money spent on music college, competitive sports - who knows what they will love doing.

It will be an exciting journey and I'll report back in a decade or so...!

Thank you all again.

[Supermarketshopping10]

I would go to a few open days for both pre prep and prep schools as well as senior schools just to have a look and get a flavour of your local fee paying schools. not all fee paying schools are good and some are excellent and worth every penny - I would go on open days and see what the extras are?
Do you have a grammar school system near you, I know Kent and Herts/Bucks do if so you could pay for prep then hope for 11+ entry to grammar school?

Some families do 7+ entry to prep and stay till 16 then good 6th form, there are so many options, some would prefer to pay for small classes from reception.

A lot depends on character of your children and the schools you have on offer, there are great state schools out there and great fee paying but not all schools suit all children so as you have the money I would look around at the actual schools rather combined with the thoughts of when to enter few paying.

Last thing to remember which I am sure your husband knows is the extras that come with few paying schools especially secondary - ski trip? Sports equipment? Pressure to do activities with friends etc etc...

Anyway a lovely position to be in and I recommend open days, even if kids are little they give a good taste of schools.

[Talkinpeace]

OP
Honestly,
if needs be move house to a yummy catchment, but £100k will not go far once you take into account "enrichment" if you are paying for the school out of your after tax income as well as your taxes

go for a leafy comp and fab holidays

[CanucksoontobeinLondon]

I think you're right, Beabetterwife, that spending the money on a buy-to-let property would probably be inappropriate. I add my voice to the chorus that says you should save the majority of the money for university, but spend bits and pieces along the way on extra curricular activities and so forth. Those add up, but are very beneficial to the child. There are also some great summer camps out there which are not cheap and you might struggle to self-fund.

Good luck!

[hermioneweasley]

I woukd use it to fund a house move to the catchment area of the best state secondary you can afford.

[Talkinpeace]

hermione
they cannot - that is not educational and they would be made to hand it back by the probate court

[mustbeabetterwife]

You are all so very enlightening and informative (do hope that doesn't sound too sickly and unmumsnetty (sp)...!!)

Off to research catchment areas now!

[mustbeabetterwife]

talkinpeace - and morally not right in our view...

[hermioneweasley]

I don't see that it's not educational - Assumng you coukd get into a grammar, yo would be getting private school quality of education for both of them for the money, whereas it doesn't stretch that far if you're paying fees. I'm not a wills and probate specialist though.

And who exactly would be monitoring you and challenging you?

[Talkinpeace]

hermione
the probate court has state granted powers to check up on all "terms" bequests
anybody could report OP - even an estate agent
the law has really solid reasons

mustbeabetter
the thing is that if you plan it right you will look on the bequest as the most positive life enhancement ever, rather than something that pressured you into choosing things that were borderline

the family I know who have the trust fund love the fact that they can do music and sport and drama and trips and summer camps that utterly enrich all of their lives
while going to the comp and working bloody hard

[fizzly]

I would use it to subsidise fees for 11-16 (and save the rest yourselves). Uni debt is becoming the new normal. Paying upfront isn't economically very sensible, so saving all the money to plough in at this point isn't very sensible as an absolute priority, in my opinion.

[TheFuckersonInquiry]

I would do Option 3

State until 16 and private for 6th Form. If they need it or want it at the time. I would use lots of tutors etc and then give them money for Uni. Who knows what the situation will be like for Uni fees when they are old enough but I am sure the money would come in useful one way or another.

[curlew]

Why private for 6th form? I would have thought that of all the private options that is the least useful.

[Talkinpeace]

Why private for 6th form .... most of the private parents round here like this place www.psc.ac.uk/