Planning for your Child’s Education and Future

*This is a collaborative post

Saving for children's education

Planning for your Child’s Education and Future


Whether politics is of much interest to you or not, it has been interesting to note the new Prime Minister’s emphasis on grammar schools, and to scrap the present ban on them which has been in place for two decades. A lot of fuss has been made about it, but many people may be unsure as to what exactly a grammar school actually is.

Essentially they are state secondary schools which are selective in who they accept, with pupils required to pass what is known as the ’11-plus’ exam in order to get in. There are just 164 grammar schools in England, with none in Scotland and Wales, and a ban on them in Northern Ireland.

Weighing up the good and the bad

The main bone of contention with grammar schools historically is that many believed the system was failing children with working-class backgrounds in terms of the results they actually achieve at these schools. As a result, they were deemed to be entrenching a lack of social mobility.

The counter argument to that though is that grammar schools can also enhance social mobility, and ensure that bright, talented children from poorer backgrounds are able to elevate themselves to higher levels than those which a typical state or comprehensive school could arguably take them.

With the costs of private schools ballooning, government-funded grammar schools could potentially offer parents desperate to give their kids a the best possible education a viable alternative.

Saving for your child’s education

Regardless of your thoughts on grammar schools, one thing which is brought into focus is the need for young parents (or would-be parents) to plan ahead for their child(ren)’s years in education. A recent study shows that the costs of putting a child through state school alone is still in the region of £23,000, or £1,600 per year. If you plan to have more than one child, this of course begins to snowball. Added to that, if you wish to put them through University, and contribute to the fees for this, then a big financial hurdle sits in wait.

First and foremost, the key is disciplined saving. Do a budget of your monthly income less outgoings. Now subtract as much as you can while still allowing you enough money to live relatively comfortably. That amount should then become your monthly aim for education saving.

A good trick is to open a separate account specifically for the purposes of education and pretend as though it exists only for transfers in, not out. That way, the money will be ring fenced, and can steadily accumulate so that when the time comes to actually pay fees and schooling costs, there isn’t a major shock to the system.

Investing as an alternative

As this is a long-term exercise of saving, one thing to consider to try and make your money work a little bit harder for you. After all, savings rates from banks and building societies are utterly dismal at the moment, and they look set to get even worse.

For those with a bit of know-how (and courage), you could look to invest such money in things like stocks and shares. However, a more user-friendly investment alternative which is becoming increasingly popular is that of P2P lending, in which you essentially lend your money directly to fellow consumers who need a loan via an online platform. This option does carry risk, but controls are in place, and returns are often as high as 6 per cent.

The other option is to put money into Child Trust Funds, which offer tax-free benefits, although these are more geared towards saving for university. You could also consider private tuition or maths classes for kids as a more cost-effective option.

Good planning, and sticking to it

Whichever route you decide to go down in terms of your child(ren)’s schooling and education, there will be financial implications to consider. When you factor in that raising a child to the age of 21 is said to cost more than the average semi-detached house in the UK, it really does put it into perspective.

The best thing you can do is to start planning, and executing these plans, as early as you possibly can. In these increasingly uncertain times we’re living in at the moment, help from the state seems to be diminishing, so all we can do is take care of things at home in order to safeguard financial security. A bit of preparation, and plenty of self-discipline can go a long way to ensuring that your kids have a great childhood, and a prosperous future too.

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