School fees

[Sevian]

How much of a cushion do you keep in savings for school fees? Currently we have zero! We pay the fees out of our income and in a just in time basis. Now that I'm going back to work we should be able to put some aside. But I'm wondering what's reasonable to aim for as a goal? 2 years?

I think two years is ideal, or to the next obvious transition point, you wouldn't want to withdraw a child half way though GCSEs or A Levels.

At the moment I have 3 terms worth of fees set aside, but usually I'm like the OP and just pay out of salary, which is not ideal

Good to know I'm not alone. Eldest dc is in year 5 with younger dc about to start state school next autumn. I feel like we need some sort of cushion before we take on 2 sets of fees.

At present we have a year each per child as they are in preschool and reception so the fees aren't so high. When my eldest goes into year 1 and her fees increase we'll aim for 2 years.

I don't pay school fees but used to have a £1200pm nursery bill. I would pay it on the credit card and then pay it off on payday. Rinse and repeat.

I pay our fees a year in advance to take advantage of the discount and then start saving for the following year.

We do have separate savings that could cover a few years if needed, but if our circumstances changed dramatically we would have to decide if it was wise to use the savings for fees. Obviously the closer they get to the end of schooling the more likely we would be to keep them there. I think it's really important to be able to cover the full GCSE or A level courses when it comes to that.

Our youngest isn't even in school yet but I wonder if it's not wise to save with the goal of having gcse and a level saved for both of them knowing that if things changed we'd go state until gcse.

We just pay out of income but we are high earners. Everyone's situation will be different.

The fees might have increased massively by then, not necessarily in line with inflation - add a good amount to your estimate.

I think many people pay out of salary but it is a good idea to have fees saved to the next break point. Also good to have fees covered in life and disability insurance.

However you should also remember if you have that much cash in savings it will be losing money in real terms - whereas invested it should be gaining money over time. On the other hand you would be more likely to lose your job during a recession and market crash. You have to calculate your own risk tolerance!

We pay out of salary but keep a big buffer just in case, some in cash and some in an equity portfolio. I give it a lot of thought as I have two and they're young and their school fees will ratchet up quite significantly as they progress through the school - plus you have the c. 5% annual increase. I'd save whatever you can into a school fees fund for sure. If you don't need it then it can be used for something else later.

We are about to move our three dc into private (primary age) and have three years of buffer. We felt we needed more as there's no obvious break point for all three (they are all two years apart) and we are looking at three sets of fees for a long period (youngest going into reception)

We are aiming to pay each year from income and save a years fees each year as well if we can so the buffer grows and eventually we have enough in there to cover the remaining years.

We have 1 years fees for both set aside, although one leaves soon so we will have 2 years fees for 1 of them then.
I would be too worried to just pay it out of income with no back up. I was at Private school and people left never to be heard from again. One poor girl had been there since prep, so around 4 and then she boarded from 7 while her parents worked away. Her Dad lost his job (company paid the fees) and she left half way through A levels. She was desperate to keep in touch with us all and regularly used to wait outside the gates when it was home time. She even applied for a job in the school office which she obviously didn’t get

@Sevian

Our youngest isn't even in school yet but I wonder if it's not wise to save with the goal of having gcse and a level saved for both of them knowing that if things changed we'd go state until gcse.

Unless State Primary options are really bad I don’t see the need for Private at that stage. Plus I think both my DC benefitted from NOT being at The prep school. Save now so you can afford Private Secondary comfortably

Our plan is to have a high proportion of secondary saved by the time we get there for both DC. We are well aware we are financially cautious but at least we are on the same page together!

It is what has put me off private primary tbh not having the money already saved

Friends of ours: main earned just been made redundant, just bought new house and just moved 4 kids to private school. They now need to ask the school for some kind of fees break... I wouldn't do it. We don't have the fancy cars or 4 kids but have saved all school fees in advance. I couldn't cope with the stress...

Our independent financial advisor said that ideally you should have three years worth of fees set aside to ensure your child can continue their education if your circumstances change.

It’s based on in Year 7 you go into it expecting to be able to pay from income based on current circumstances. You then become aware that your finances aren’t quite what you expected in Year 8 but can still muddle through. Come Year 9 you can’t afford it any more but you have three years of fees put away to get them through to the end of their GCSEs. They can go elsewhere for A levels.

If you don’t dip into to the three years “pot” then you should have enough to then cover three years at university.

Made lots of sense to us but appreciate that unless you start saving when they are born, not everyone has such a large amount just lying around.

Eldest is already in a prep and won't be moving as he has special needs. Youngest we will start at the local primary and aim to save fees the years he's there. Maybe aim to move him in year 3.

I used to keep 12 months in hand but she’s elected to go to the local College to do her “A” levels so what ever is left in the pot to take to the end date, less the deposit value.