Parents paying for University costs

Parents paying for University costsIt’s nearly that time of year again, when children fly the nest and head off to University for the first time.

And University can be an expensive business.

Back when I was at Uni, I was very fortunate to be in the final intake before the introduction of tuition fees.

Even without this annual invoice, the cost of accommodation and other living costs were significant.

Research from Wesleyan, the specialist financial services provider, has found professionals would like to ease their child’s student debts by contributing an average of 67% towards their university costs.

They found that today’s students are graduating owing an average of £40,500 in University related debts.

This could mean parents need to find £27,135 by the time their child finishes university.

Clearly the best way to come up with this sort of cash is to start saving as early as possible.

Wesleyan calculated that if parents saved £82 per month from when their child was born until graduation day, they could cover this anticipated contribution to university costs.

The cost of delay is quite large.

Waiting until the child starts primary school at age five would mean they need to save £115 a month to achieve the same level of savings.

If parents wait until their children start secondary school at age 11, the monthly cost rises to £199.

Waiting until just a couple of years before the University course starts, when children take their GCSE exams at age 16, and amount required to save more than doubles to £424 a month.

The cost of higher education is something we encourage parents to factor into their Financial Plans.

By making reasonable assumptions about the future, new parents can set aside modest amounts each month with this purpose in mind.

Parents who have waited until their children are closer to University age can use Financial Planning to explore the impact of using existing wealth to help get them through Uni.

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About Martin Bamford

Martin Bamford is a Chartered Financial Planner, Certified Financial Planner (CFP) professional and published personal finance author. He works with elderly clients to provide advice on funding residential care fees, hosts the Informed Choice Podcast and is a keen ultra runner.
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