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Original poster

Advice sought re. school bursaries and property

81 replies

AssetRichIncomePoor · 04/09/2011 19:56

Our children are currently at prep school, which is just about affordable as one has an 80 percent choral scholarship. In due course, they will move on to private secondaries - whereupon the fees go up so much that we can't afford them. We are hoping that DC1 will get another scholarship - but that is likely to be worth only five percent of the fees, which leaves us with a mere 95 percent of around 5k per term to pay.

Our gross income is around 40-50K (most of it from holiday lets), so we would in theory qualify for a bursary on top of any scholarship.

However, we own property: two holiday lets, one rental property (with a mortgage) and our own house (with a mortgage), so fear this will exclude us from bursaries. In total, we probably have 550K of our actual money invested in property. If we did sell all our property, that would enable us to pay some fees (though not for long, as DS is wanting to board). However, it would leave us with no income and no pension.

Does anyone have any idea how we can get round this problem? Any advice would be most gratefully received.

OP posts:
TilGT · 04/09/2011 22:30

Hi,
In general the top tier public schools have a fair whack to give out each year in bursaries... But given the state of the UK and world economy they may not be as generous in handing it out, so you may need to a. Apply early and b. Do some surreptitious research into how many burseries have given out in the last couple of years...
It is of course also up to you what you decide to divulge on the bursary application in terms of holiday homes etc iykwim...
Good luck!

bibbitybobbityhat · 04/09/2011 22:33

Am intrigued as to why you feel your children should go to private boarding school when you don't have the cash to pay for it?

mrswoodentop · 04/09/2011 22:46

I am involved on this type of decision.The first reaction of most schools I know of would be to tell you to liquidate some capital.Bursaries are there for the genuinely needy and not to facilitate lifestyle choices or protect retirement plans.
Schools are increasingly savvy about this and will ask awkward questions about capital etc,many now employ specialists to visit people at home etc

Merrylegs · 04/09/2011 22:53

I am really surprised to hear you would qualify for a bursary on 40k a year. Have you checked this? The norm is 15k or under with no other asset than your home.

belledechocchipcookie · 04/09/2011 22:55

The bursary's vary from school to school. Ds's cuts off at 50k, I'm assuming it's a sliding scale though. If you have half a million in capital then it's doubtful that you're eligible.

Original poster
AssetRichIncomePoor · 04/09/2011 22:56

Hmm, that is what I feared, mrswoodentop. If they visited us at home, they would probably conclude that we belonged in the 'needy' category (especially if they take your car into account, and the fact that our house is a building site).

I feel that we are in a bit of a bind. I can perfectly well see why people should liquidate capital - but our capital is the only thing that gives us an income, which is where we have a bit of a stumbling block. Ho hum.

Thank you, TilGT, for the advice. We are indeed starting early. Someone said DH and I should get divorced, but I that's not a path we're planning to go down, even for a bursary. Grin

bibbity, I was expecting that question (and others, less kindly asked). There are several reasons; the most pressing is DC1's extraordinary abilities.

OP posts:
Original poster
AssetRichIncomePoor · 04/09/2011 22:58

The ones I've looked into, Merrylegs (nice name!), have around 40K as the cut-off point - and as belledeccc says, it's a sliding scale. Bah.

We are wondering whether we could turn the properties into a business rather than have them as personal assets - but wouldn't know where to start with that one.

OP posts:
Lougle · 04/09/2011 23:02

I'm a bit speechless. Truly.

margerykemp · 05/09/2011 08:35

I think you are a bit clueless when it comes to comparing your relative poverty/ wealth to the general population's.

Have you ever seen a bursary application form? You will have to declare ALL income assets inc pensions, cars etc. They also consider what kind of holidays you take. They expect you to prioritise fees over pensions, unessential home repairs. If you have equity they expect you to renortgage.

As things stand you are going to have to talk your ds out of boarding.

janinlondon · 05/09/2011 08:52

If the child has extraordinary abilities surely you should be looking at scholarships, rather than bursaries? I seriously doubt you will get anywhere near a bursary with that sort of income and those assets.

Bingbangbong · 05/09/2011 08:56

How about getting a job?

Original poster
AssetRichIncomePoor · 05/09/2011 09:01

Janinlondon, scholarships are precisely what we're looking at. However, they're only worth five percent of the fees, so we would need a bursary on top of any scholarship.

Margerykemp: we have no holidays, no pension (property aside), no home repairs (our house is a building site because we can't afford to finish it). We have a fifteen-year-old car. All our income goes on fees and mortgage. I had a trust fund which enabled us to buy the holiday lets which provide our income. Without the holiday lets, we have zero income. Though that would of course mean we would qualify for a bursary. Grin

Thanks for the advice, Bingbangbong, but the holiday lets are a job.

OP posts:
pinkytheshrinky · 05/09/2011 09:08

Why don't you have jobs? real ones? 40 -50 k a year is shit between two of you - it does not take 2 of you full time to run holiday lets

Lougle · 05/09/2011 09:11

Ok, I have found my speech.

I am shocked that you consider a £40-50k annual income to be 'cash poor'.

I am also confused as to why you feel that your current properties are 'personal assets' rather than a business? Any property that is let out to other people, whether long-term or for holidays, is a 'business' for tax purposes, and all income must be declared and taxed. I take it you do declare your income? Also, the vast majority of mortgage lenders don't allow homes to be let out unless they are on a 'buy-to-let' mortgage. If you don't have one of those, you need to read carefully your terms and conditions. For those reasons, I find it hard to imagine how your additional properties are anything other than 'business'.

I also sincerely hope that you wouldn't get a substantial bursary based on your income. 40-50k + multiple houses is NOT poor, no matter what car you drive. What car is it, incidently?

fivegomadindorset · 05/09/2011 09:12

I agree with Pink on the fact that it doesn't take two of you to run two holiday lets (I know from personal experience) although disagree with the 40-50K being shit as we earn half of that between 2 of us.

noddyholder · 05/09/2011 09:14

How cheeky! You can,t afford it without selling some property so either do that or look elsewhere. Bursaries are not so that people who buy up multiple properties with debt can grow their nest egg and educate their kids privately at the expense of someone more deserving I am shocked you even consider it tbh.

Malcontentinthemiddle · 05/09/2011 09:14

It's a pisser, isn't it? I live in a hovel on baked beans, but because I have all this gold in a big pile, none of the local private schools will give me a free place!

pinkytheshrinky · 05/09/2011 09:17

ooh sorry 5 - i mean it is shit if you expect put kids through private schools - i have two rental, 4 kids, a puppy and elderly people to look after - gettibg a job is what they need to do - and with half million assets you have got a massive cheek even asking for help.

levantine · 05/09/2011 09:18

OP I'm afraid I agree with everyone else - if you want to educate your DCs privately you need to liquidate your holiday lets and get another job

However, I would have thought if your DCs are really that gifted they would be okay at a good comprehensive. They DO get people to Oxbridge you know if that's what you want.

fivegomadindorset · 05/09/2011 09:19

Agree with the getting a job, then maybe they can finish the house.

pinkytheshrinky · 05/09/2011 09:19

This used to be called 'living beyond one's means'

LaurieFairyCake · 05/09/2011 09:22

Are your holiday lets tied together? - if not can you sell one, realise some capital, finish your house and pay for the schooling.

If you liquidated 200k surely that would finish your house, and put the children through all their schooling?

I think if you feel private school is important to you then 'living for today' is going to have to be your mantra - no one needs half a million pension (plus presumably what your house is worth).

Frankly this post is no different from anyone who has much less money - it's about deciding your priorities. If you sold a property it can do all of the above and maybe free up enough time to do a part-time job (either of you) to supplement your income.

Lougle · 05/09/2011 09:24

"no home repairs (our house is a building site because we can't afford to finish it)."

No, you are choosing not to sell one of the homes to release cash to finish it.

fivegomadindorset · 05/09/2011 09:40

Sorry reread op, if that is your gross income what is your net income?

EdithWeston · 05/09/2011 09:52

The bottom line is that you will have to ask the bursar of each school you are interested in. Every school has its own procedures, thresholds and disregards; and the pot of money available will also vary depending on both its size and the existing calls upon it.