Funding Your Child’s Further Education

Having children is certainly an expensive business. Young families usually have to cope with owning one of their first properties along with maintaining the child’s welfare, and as they grow older this can get a whole lot trickier. Not only have you got to think of how to spend money to keep your child happy, there’s also their higher education to consider. If you want your child to get through university, then it can present a financial conundrum – university costs £9,000 in tuition fees alone, and when accommodation and living costs are factored in this can double. So where are you going to find the £18,000 to finance your child’s education?

Student Loan

Unless you have a large amount of cash spare, then making sure your child has a student loan is essential if they are going to feel financially comfortable through university. A student loan has a rate of interest that matches the rate of inflation; therefore it is quite simply the cheapest loan your child will ever get. Even if it’s not needed, it’s worth getting and then putting into a savings account, as you will make a profit on the interest accrued – take a look at Alliance and Leicester for a comprehensive range of savings accounts. One thing to note about the student loan is that it’s purely for upkeep and accommodation. Fees are only repaid after university through whatever salary the graduate will have. So long as it’s over £15,000 a year, they will be repaying their student loan and fees as if it was another tax.

Child Trust Funds

If you’ve got your child’s further education in mind from their early age, then you’ll be on the right track for funding them through university – the earlier the better. One of the best ways to save is through a child trust fund. This is a stock market based investment, which the government will contribute to, and expires when the child reaches a certain age. Over the long term, the stock market is normally the best way to accrue the best return on your money, and investing regularly will see the value rise neatly. Just think, if you put in just £50 a month for 18 years, then that’s £10,800 even before the return on investment is considered! Basically, it will pay a lot to think of this early.

Banking and Insurance

Funding your child’s way through university is only part of the financial planning you’ll need to consider. Sure enough, if you take out a student loan and have an effective saving plan in place, then you’ll have much of the finance you’ll need to see them through the three or four years. Apart from this, you should also consider a student bank account. These are standard savings accounts with large interest free overdrafts – normally between £1,000 to £2,000. They can also offer perks for opening one, such as a free young person’s rail card for five years, or a £50 cash incentive. Further to this, student insurance is also vital. Considering the often lax security of student accommodation and the value of student property, it’s an important thing to consider – it might even be the most important thing to consider if something of high value was damaged or stolen!