Financial Planning

A short guide to saving for private school

A short guide to saving for private school

This content is for information and inspiration purposes only. It should not be taken as financial or investment advice. To receive personalised, regulated financial advice regarding your affairs please consult an independent financial adviser.

Private school in the UK is certainly not cheap. In 2022, average fees are £4,980 per term, or £14,940 per school year. Over the course of secondary school, therefore, one child could cost over £89,000 to put through his/her education. The payoff, of course, is often worth it – giving your child a strong academic foundation and boosting their opportunities later in life. Yet how can you save for it wisely? 

Below, our team at Cedar House offers some ideas based on our years as financial planners. We hope this is helpful to you. If you want to discuss your own financial plan with us, please contact our team for more information or to access personalised financial advice:

020 8366 4400 or


Get the costs clear in mind

As mentioned, private school in the UK can cost nearly £15,000 per year. Yet it can be a lot more expensive. American School London, for instance, charged £34,700 a year earlier in 2022 for a kindergarten student. Naturally, the earlier you want to put your child into private school, the more it will cost. Secondary education alone, however, amounts to 6 years of fees.

Two other important factors can influence the costs. Firstly, boarding school will typically be dearer than those which do not board. Eton College, for example, once charged £44,094 per year for boys aged 13-18. Secondly, a lot can change in the education sector – and the wider economy – over the course of a child’s education. 

Perhaps new government policies come into force which influence the costs. Inflation will also naturally drive up the price of services like private education, over time. These scenarios are impossible to predict but may lead the total costs of private school to be higher than you might otherwise expect.


Plan ahead of time

The sooner you start saving and investing towards a child’s private education, the more time you have to make contributions and benefit from compound growth. If you decide you want to put your child through private secondary school, for instance, then planning at his/her birth allows you 10+ years to start saving.

Be careful not to use cash as a savings vehicle. Whilst it may seem “safe” (i.e. immune to market volatility), the interest rate will not beat inflation and the money will lose a lot of value over time. Rather, consider seeking financial advice to build a well-diversified portfolio of investments with a greater chance of producing higher, inflation-beating returns (e.g. equities).


Make your savings maximally tax-efficient

Inflation will eat away at your the returns on the pot of money for your child’s school fees. Yet taxes will also do so if you are not careful. Your ISA, for instance, allows you to save up to £20,000 per year and produce interest, capital gains and dividends without tax. Your spouse (assuming he/she is also UK resident) also has an ISA allowance, allowing you to combine contributions to build a £40,000 tax-free ISA portfolio each year. 

Pensions and Junior ISAs will not typically be suitable to help save for private school, despite their tax-efficient benefits. The former cannot be accessed until you reach age 55 and should first be put towards your retirement plan. The latter cannot be accessed until your child reaches age 18, by which point they will have finished school. However, a Junior ISA can be a helpful tool when helping your child save towards higher education (university).

Grandparents may also be willing to contribute to the private school pot; not just to help your child, but also for estate planning purposes. Each year, an individual can make up to £3,000 of gifts without these being subject to inheritance tax (IHT) later, via the “annual exemption”. This effectively allows a grandparent a tax-efficient means to reduce the value of their estate.


Other thoughts

It may be possible to reduce the total fees of a child’s education if you pay up-front, although you will need to check with each establishment. Certain schools may also provide a discount when you pay termly, rather than monthly. You may also be able to find reductions on a second child if your first child is a current student. Discounts may also be available to parents who are private school teachers, clergy or in the armed forces. These offers are not necessarily made widely known to parents, so you will need to hunt for them.

Of course, bursaries and scholarships can be tremendously helpful if you can secure them. Yet these cannot be guaranteed and only a minority of students attain them. Take care if you are tempted to take out a loan or remortgage to help pay for school fees. Going into debt, even for your child’s education, can be detrimental to your financial stability. Speak to a financial adviser if you are considering an offset mortgage or other loan option. 



Interested in discussing your financial plan with an experienced financial adviser? Get in touch today to discuss your financial plan with a member of our team here at Cedar House via a free, no-commitment consultation:

020 8366 4400 or


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