Bursary Application

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HelloI am just going through the form for DS's senior school Bursary application and it asks:" Please explain any reasons why net assets cannot be converted or utilised to pay school fees."Yes in our case our only asset which has some "net" in the property (although we do have some savings (for a rainy day) which is not sufficient to pay for the entire senior school period). We recently bought our first property and there is no question of re-mortgaging the house to release equity to pay the school fees.I am not sure how the Bursar would look into our finances, but we have kept aside £40k in our savings. We have kept a portion of these savings aside, one reason is to fund non routine travel costs arising from medical emergency and ad-hoc medical expenses to support my mother who lives overseas. This may be due to hospitalisation or general age related ailment (She is 73 year old). I have allowed three routine overseas trips in a year and making it clear in my application that these are necessary trips to ensure my mom's well being. Do you think it will go against us.We recently bought our first house 3 months ago, and the equity in the house is 30%. Again, will this work against our application.I am trying to articulate in the best way possible to answer the above question.Any thoughts will be high appreciated

If the 40k also went towards the house equity, what would be the difference between both cases?

Higher equity in a property meaning lower mortgage repayments and higher "disposable" income, or the potential to release some of that equity by remortgaging. We had much higher equity in our property when we were filling out bursary forms, but no capacity to remortgage and our house was not overgenerous for our family. We were told that one potential school had an upper limit on actual property values that would have ruled us out, but the assessor who mentioned that also said that his company had tried to persuade them they needed to lift that given typical property values in the general area.

Our savings were certainly taken into account, and when the youngest started senior school we estimated that we could run out a term or two before he finished. Happily it worked out a little better than that and we hadn't quite run them down completely at the end.

Be frank when discussing your situation with the bursar, but also be prepared to have to justify what your money is being spent on / kept available for, and for them to expect you to scale back depending on their judgement of the situation.

@MogdenSewage Totally depends on the overall value of the property.

If it’s worth £200k with £60k equity then another £40k would take it to 50% equity. If it’s worth £1m (many modest London properties do cost this much!) then the extra £40k would only make it 34% equity.

Some schools apply a % of equity formula only, others would look at the overall property value and make a common sense judgement. In reality though with a new mortgage it’s unlikely a large lump sum could be paid off in the short term with significant early redemption rates.

You’d be surprised how many applicants don’t feel the need to dip into “rainy day funds” for the purposes of school fees. Of course you are allowed some savings under bursary applications, but £40k is seen as excessive.

But then they would not have external inspectors. @tennissquare And I definitely remember that she said that their office is in Kingston.

We're probably far lower income than you, but when we looked at a modest private school (£8k per year fees), even on a low income topped up by UC, and no savings, we were expected to pay half fees. My daughter didn't like the school so stayed in her state school. Now that the COL has risen so much, I am very grateful because I can't imagine trying to find that money now.

If you need a bursary, have you worked out how much you will be able to stretch before you can't afford the fees? Most bursaries are only a percentage of the fees.

@throwawayaway1 possibly.I found that organisation where she works https://www.schoolbursaryguide.com/

The way you word your mother's situation is a bit woolly. It sounds like she's not actually ill or particularly old, so it really is a rainy day situation rather than a reality. She could be fine for the duration of your son's time at school, with no need for non routine emergency visits. If she's actually I'll and you're already having to budget for the visits, that's more understandable, although still, three a year doesn't sound like an emergency. It's a lot of money to not spend on the school fees, and of course many parents don't have the money upfront for the whole of the schooling, but if you can save 40k, it would seem like you could keep saving and cover the trips in an emergency. Always worth a go but there's likely to be applicants with less ready cash who need more help.

Every school is different so you need to ask what they are looking for. Generally speaking equity in the house you live in is fine but obviously they wouldn't expect you to own a 2nd property, nor would they expect high-brand cars etc. I would say that you are keeping the savings for visiting your unwell mother who has health issues.

It isn't the case at every school, many have not outsourced the bursary process.

£40k in savings is likely to exclude you. Very few normal people have that

This simply isn't true. It depends on the school. For some schools this isn't really much more than a year's fees. What it would mean at my daughter's school is that they might expect you to make a contribution of 5% or 10% of fees per year. The (day) fees are nearly £30K per year.

I'd expect bursaries to go to children who couldn't otherwise access it at all. I'm sorry but someone who owns a home, prob in a decent area and can save £40k isn't to me low income. £40k would be a couple of years fees

This simply isn't true. I speak with a great deal of experience here. If a school is genuinely on a mission to make an excellent academic education available independently of the constraints of state control and not about social segregation then the bursary programme cannot and should not be solely focused on selecting a few students from the very poorest families who couldn't afford to contribute a thing, and have them mix with all the self-funded pupils whose families don't need any help, and ignore the enormous grey area in between.

Intelligent and able youngsters will exist in every bracket of wealth and income. The ones in the middle whose families could afford £8k per year but not £16k don't deserve to be excluded either.

Bursary programmes will regularly be set up to give a proportion of bursaries at 20%, a proportion at 40%, a proportion at 60% and 80% and a small number at 100%. This ensures a smooth spectrum of levels of wealth/afluence which is healthy for the school and ensures a diversity of experience with no huge chasms between haves and have-nots.

Obviously therefore some bursary recipient families will have substantial savings or income sufficient to pay a significant chunk of the fees. There's nothing wrong with that.

Someone with £40K in the bank can't access a school that costs £30K a year or even £15K a year. You don't know how long it took to save £40K. If you can save £40K in a year or two, you can maybe access enough money for fees (depending on the actual cost). If it took five or ten years, you can't.

Bursaries aren't all or nothing and nor are they designed to leave families in receipt worse off than they would otherwise have been. They will look at how long it took to save that money and how much is actually coming in and going out and act accordingly.

For my daughter's school, the likely outcome in this case if income wasn't enough to pay the fees would be a large partial bursary so that the parents would be paying perhaps £3K a year (likely a similar amount to what they had previously been able to save). At DD's school, the majority of families in receipt of bursaries are on full fee remission.

@YireosDodeAver well in my city if you earn a £50-80k joint wage and own a house and have £40k savings you'd not get a bursary anywhere. Not even close.
I do know people that declare they earn £50k, live on our road but claim they have low savings who do.
One parent doesn't work by choice yet could easily earn £20-30k if she wanted to. Husband earns £50k plus

@BonjourCrisette no idea where your school is but £30k for day fees is high. We are north west. Day fees are around £15k

@eurotravel the OP hasn't mentioned their income at all but "household income of £50-£80k" (ie annual take home assuming two earners of between %42k and £62k after 2 lots of tax and NI) is a nonsensical income bracket when talking about a £16kpa expenditure - it's quite obviously orders of magnitude different in affordability at the top and bottom end of that spectrum. Brackets need to be much, much narrower than that.

But in your city, what is the income level of a family who is comfortably able to pay 60% of fees from their household income (so presume around £10k per year) and receive a 40% bursary?

@YireosDodeAver

Ignore @user18's response. It is legitimate to have assets and not reduce yourself to rock bottom before asking for a bursary.

There is however a big difference between owning a house with $40k in savings and rock bottom.

@YireosDodeAver all the local schools to us say no bursary if income is over eg £50 or £60 Below that they look at savings too.,
A huge % of middle income families thus are not rich enough to afford it if poor enough to get assistance.

Private schools are increasingly prioritizing transformational bursaries, which can make a huge difference for the beneficiaries and foster social mobility, instead of subsidizing the bills for middle-class families, which leaves a gap in the social diversity of many private schools.

If your child was going to university the 40K savings would need to be declared and would be considered meaning you would need to contribute more. You should not be getting a bursary if you have 40K in savings- use that or move to state school.

The schools in our area can fill all their places without subsidising the middle class. Many parents in the middle brackets make huge sacrifices to manage it & try live on what's left.
So yes as @MogdenSewage says bursaries are for lower income families.

@eurotravel that doesn't answer my question.
At what income level is one expected to contribute ~£10k of fees from household income and receive a 40% bursary for the other ~£6k?

Or do you deny the existence of partial bursaries?

One thing to take from this thread is not to believe random strangers without checking. A useful lesson for us all, @JustWingItLifeEyelinerEverything

Ha ha you said it if that conversation was impacting my life in any way 😃 and I had intention of applying for any bursary. ....And no, she wasn't random stranger but a person employed by the Bursary Administration Ltd. Simply either I may have not understood what she was talking about or she has not expressed clearly enough to understand her