A Costly Lesson in Education; PERSONAL FINANCE
Byline: Neil Simpson
THEY are growing at twice the rate of inflation, can cost double the price of the average house and force people to sacrifice everything from holidays to new cars.
They are school fees, the new millstones around the necks of increasing numbers of middle-class parents worried about the state of State education.
Ideally, they would be paid by the term out of
parents' normal income. But while the rich can write big cheques without a second thought, most fee-paying parents are hard pressed to find up to [pounds sterling]4,000 a term to keep each child at private school.
According to Scottish Provident, fees have been rising steadily for the past five years. In 1991 the cheapest day schools charged about [pounds sterling]800 a term while the more expensive boarding fees hit [pounds sterling]2,900. Last year many day schools topped [pounds sterling]1,100 a term, while boarders paid more than [pounds sterling]4,000.
The Independent Schools Information Service (ISIS) says last year's fee increases averaged 4.8% and predicts this year's will be between 5% and 6%.
At the same time, inflation stands at 2.2% and average earnings are rising by just 3.7% a year.
But for parents, these fast-growing fees are only the tip of an increasingly expensive iceberg. Parents soon learn they need more money for a host of far-from-optional extras. Learning a musical instrument can add about [pounds sterling]150 a term to the bill. Tennis lessons can top [pounds sterling]50 a week, foreign exchange trips will eat up at least [pounds sterling]150 plus fares, and skiing holidays another [pounds sterling]500.
BOOKS and club memberships
can also swell the total - and many day schools send separate bills to cover lunch and stationery.
Mike Cobb, managing director of Termtime Credit, says: `Many parents aren't prepared for the full costs and get a shock when the bills start to come in.' Termtime, based in Epsom, Surrey, offers a loan-based scheme to help parents spread education costs.
Once the decision to send children to private school has been taken, the bills continue for years. Latest calculations from financial adviser The Scholar Partnership, based in Watford, Hertfordshire, show that it will cost more than [pounds sterling]120,000 to keep one child in private school from four to 18, and help the child through university, when parental contributions are still vitally important.
On this reckoning, the bill for two children is likely to approach a quarter of a million pounds. Despite this, an increasing number of people are deciding to bite the bullet and put their children through private education.
ISIS says the number of children in fee-paying schools is picking up after several years in the doldrums. The biggest increases are for girls and younger children. It has recorded a 7.4% increase in roll-calls at private pre-school classes in the past year. This is great news for the public school sector, which believes that the sooner parents become accustomed to paying fees, the longer it will keep them on board.
So financial planning becomes more important than ever for those who may face big bills for the next 17 years.
Parents who plan to keep their children within the State system should check that they will be able to support them through university.
Last year about 25,000 students were forced to drop out because of lack of funds, making educational costs planning an area of concern for more than just the parents
of the 600,000 children in the private sector.
THE golden rule of
planning for school fees is that the sooner parents start, the easier it will be.
Specialist school fees advisers say the most clued-up clients ask for help as soon as a child is born.
Marianne Cantley, product manager at Scottish Provident, says: `The more time parents have to build up a fund of money, the more options they can consider. …