Choosing private education is a huge decision – financially, yes, but emotionally too. It’s about wanting to give your children the best start, while juggling everything else life throws your way.

Many families naturally focus on the next term’s bill at first. Life’s busy, and the costs can feel abstract in the early years. But treating it as a short-term expense, rather than a long-term financial commitment, is where things often start to unravel. That’s exactly where a clear, structured plan makes all the difference.

Moments like this happen a lot. Most families don’t underestimate because they’re careless; they underestimate because they’ve never seen the full picture laid out in front of them. Once they do, the conversation changes and everything feels calmer, more deliberate, more in control.

Where families often trip up with school fees

There are a few familiar patterns we see:

• Looking only at the termly invoice, not the full VAT-inclusive annual figure.
• Underestimating extras like trips, wraparound care, music lessons, uniforms and holiday provision.
• Not projecting 10–15 years ahead, so fee rises and VAT quietly double the total cost.
• Relying on one funding source, usually income, without a buffer.
• Leaving family (especially grandparent) conversations too late.
• Treating fees separately from pensions, property, business and lifestyle planning.

All of this is common – and totally fixable.

Here are our top tips for private school fees planning:

1. Give yourself a head start

Starting a couple of years before fees begin makes a real difference. It gives you time to build savings or investments, adjust cashflow, and bring grandparents into the plan properly. A short runway might not sound like much, but in financial planning terms, it’s oxygen.

What families often do with that head start:

• Redirect nursery or childcare costs into a dedicated “fees fund” once those costs end, so money that’s already leaving the account simply gets reassigned.
• Use that early period to open up family conversations – particularly with grandparents – about whether they want to contribute and, if so, how.
• Get an early sense of what each child’s schooling path might look like (day vs boarding, state + private mix, scholarships, etc.) so the planning horizon is clearer.

That early preparation gives families more options later. Leave it too late, and you’re often stuck reacting to short-term cashflow squeezes rather than making deliberate choices.

2. Get real about the numbers

The figure on the school website is only part of the story. Extras such as uniforms, sports activities, school trips, music lessons, and wraparound care typically add around 10% to the base fee. When combined with VAT at 20%, this brings the total increase to approximately 30% above the base tuition fee.

A simple way to work out the real figure:

1. Start with the annual fee for your chosen school.
2. Add VAT at 20%.
3. Add 10% for extras like trips, wraparound care, uniform, music, clubs and holiday provision.
4. Apply 5% annual fee increases (historical average over 20+ years).
5. Multiply by the number of years and number of children.

For example, average day school fees are around £19,000 a year, with boarding closer to £50,000 One child at £19,000 a year, plus VAT and 5% annual rises, comes to roughly £288,000 over 10 years.

A few extra considerations:

• If you have multiple children, the total cost compounds quickly. Staggering entry dates or combining state and private at different stages can make a big difference.
• Bursaries and scholarships are worth exploring, but they’re not guaranteed and shouldn’t be the cornerstone of your plan.
• Writing the number down changes everything. Once families see the full figure in black and white, decisions stop being hypothetical and start becoming tangible.

3. Project honestly – don’t hope for the best

How can families plan ahead for rising private school fees?

The short answer: look further ahead than you think you need to.

According to research by the Institute for Fiscal Studies (2023), private school fees have risen by around 55% in real terms since 2003, and Weatherbys Private Bank (2023) uses 5% as a standard projection for future fee increases. Over a 10–15 year journey, those increases compound quickly. Add VAT and extras, and the gap between what families expect to pay and what they actually pay can be significant.

Here’s an example. A £20,000 annual fee with a 5% rise each year becomes:

• £25,000 after 5 years
• £32,000 after 10 years

If you add VAT and extras, that can climb even faster. For families with more than one child, overlapping years can easily become the pinch point.

How to approach projections:

• Build a simple spreadsheet that lets you tweak assumptions (fee rises, VAT, extras, start years for each child)l, or better still use cash flow modeling software.
• Model 10–15 years, not just the next two or three.
• Include “what if” scenarios: what happens if bonuses stop, or if fee increases spike for a few years?
• Don’t overcomplicate it – this is about visibility, not perfection.

It’s rarely the maths that trips people up. It’s the timing. Get ahead of it, and you’re making deliberate choices – not reacting under pressure.

4. Structure the funding mix smartly

There’s no single ‘right’ way to fund private school fees. Most families use a blend, and the smartest plans are built around timing, cashflow, and risk tolerance – not just one pot of money.

Below are the 5 most common school fees funding levers families combine, along with the key questions and considerations for each.

Income

Using regular income to cover fees is the simplest and most flexible option, particularly in the early years when costs may be lower and investment pots haven’t had time to grow.

But it only works if the proportion of income going towards fees is genuinely sustainable.

Ask yourself:

• What percentage of household income will fees take up each year?
• Is that still manageable if bonuses stop, one partner reduces hours, or other costs rise?
• Are there big life changes (like moving house or changing jobs) on the horizon that could affect income stability?

Stress-testing income scenarios early prevents uncomfortable surprises later. If income alone isn’t enough, it’s better to know now than when the next invoice arrives.

Investing for Later

Some families choose to set aside lump sums early – often from savings, bonuses, or grandparents – and invest them so they have the opportunity to grow over several years. The idea is to build a pot that can fund fees in later, more expensive phases (e.g. secondary school or boarding).

Key considerations:

• Time horizon: The longer the money can stay invested, the more flexibility you have.
• Risk level: A mix of capital growth and income assets is common; you don’t want to be forced to sell volatile assets at the wrong time.
• Withdrawals: Plan how and when you’ll draw from the pot to match school payment schedules.

For many families, this pot runs alongside income – covering the bigger, later years when fees peak.

Upfront payments

Some schools still offer discounts for paying annually or several years in advance. These schemes were more common pre-VAT but haven’t disappeared entirely. If you have capital available, it can reduce overall costs and remove future uncertainty.

Questions to ask:

• What is the discount offered, and over what period?
• What happens if your child leaves the school earlier than expected?
• How will this payment interact with your wider financial plans (e.g. pension contributions, investment strategies)?

Upfront payments aren’t just for the ultra-wealthy. We’ve seen families use smart prepayment structures to lock in costs strategically while keeping other funding levers flexible.

Bringing Grandparents in

Many grandparents are keen to help with school fees – and their support can be both financially and emotionally significant.

Some contribute through regular gifts out of income (which can be inheritance-tax exempt if structured properly), while others make lump-sum contributions that are invested for later.

The most important thing here is clarity. Everyone should know who is contributing what, and when. Documenting agreements early avoids misunderstandings later and allows proper tax and legal planning.

Most families end up combining two or three of these approaches. For example, they might use income for prep school, an investment pot for senior years, and a partial upfront payment to secure discounts. It’s rarely about one clever trick – it’s about matching the right money to the right moment.

Tax-efficient structuring

Tax efficiency isn’t a separate strategy – it’s the thread that runs through all of them. The way you structure contributions, investments and gifts can make a meaningful difference over 10–15 years.

Key areas to consider:

• Gifts out of income from grandparents can be immediately exempt from inheritance tax if structured properly.
• Larger lump-sum gifts may fall under the seven-year rule, so planning the timing and amounts carefully matters.
• Investment pots can often be held in tax-efficient wrappers – such as ISAs, investment bonds, or certain trusts – to reduce ongoing tax drag.
• Upfront payments or property-based strategies can have knock-on effects for capital gains or stamp duty, so it’s essential to factor in the tax consequences rather than treating them in isolation.
• Coordinating these decisions with professional tax advice ensures the plan is watertight and legally sound.

Handled well, tax-efficient structuring doesn’t just trim costs at the margins – over the life of a school-fee plan, it can create real financial headroom.

5. Build flexibility in from the start

Plans that only work if everything goes perfectly… don’t. Life happens. Jobs change. Markets wobble. Schools raise fees faster than expected. Building flexibility into your plan from the start means you’re ready to adapt rather than panic.

Ways to stress-test your plan:

• Imagine one partner reduces working hours or takes a career break.
• Model lower investment returns over 3–5 years to see how it affects your funding pot.
• Build in fee increases that outpace inflation for a few years.
• Consider temporary overlapping years if you have multiple children.

Many families keep a “school fees buffer” – typically 6–12 months of fees set aside in cash or easily accessible assets. Others ensure they have alternative funding levers (like an investment pot) that can be tapped temporarily if needed, without derailing their whole strategy.

This isn’t pessimism. It’s prudence. Flexibility gives you breathing space, and breathing space buys time – which is often the difference between reacting under pressure and calmly adjusting course.

6. Make school fees part of the bigger picture

School fees don’t sit in isolation. They’re one piece of a bigger financial landscape that includes pensions, property, business plans, lifestyle goals, and family priorities.

Here’s a common scenario:
A couple plans to scale back work in their early 50s, but they also have two children whose school years overlap more than expected. Without realigning pension contributions earlier, they end up facing tough trade-offs later – either delaying their semi-retirement or taking on unnecessary financial strain during critical years.

Early alignment between school fee planning and broader strategy prevents these kinds of crunch points.

Key things to consider:

• How do fees intersect with your pension contributions and retirement plans?
• Do they affect major property decisions (e.g. upsizing, remortgaging, or downsizing later)?
• If you run a business, what role might retained profits or dividends play in funding fees?
• How does this all fit with the lifestyle you want to maintain during those years?

Tax planning weaves through every element of school fee funding. Aligning your tax strategy early – whether through gifting, investment structures or capital decisions – prevents avoidable surprises later.

When school fees are planned alongside everything else, the result is a sustainable, joined-up strategy – not a series of disconnected financial decisions.

Porta’s take

Private school fee planning isn’t about panic or penny-pinching. It’s about timing, clarity, and structuring things in a way that puts you firmly in control of one of the biggest financial decisions you’ll make for your family.

If you’d like to talk through your own school fee plan, we help families across the UK structure things clearly, calmly and strategically – so the focus stays on your children, not the spreadsheets. Get in touch here.

Important information:

This article provides general information only and does not constitute personal financial advice. The information is based on our understanding of current regulations, which may change in future. Decisions about your finances should always be made based on your individual circumstances. If you’re unsure about the suitability of any course of action, you should seek regulated financial advice. The Financial Conduct Authority does not regulate tax planning, estate planning, trusts or wills.The value of your investments can go down as well as up, so you could get back less than you invested.

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