Pay school fees in advance or invest money??!

I agree Malthusian.

A practical barrier (even if not legally binding) to lock in your customers by taking revenue from them up front well before the service is actually provided, can be a shrewd move for any business - particularly if the customers like the arrangement and feel they get something out of it.

And getting long term finance cheaply is something that a huge number of businesses do, to bankroll their operations and support expansion, new services, or generally cheap working capital compared to the cost of taking it from banks or relying on shareholders. It does not always imply financial difficulties, but can often be the opposite - assisting you in creating financial strength and a robust business model.

If they can spend the pot of advance fees received, that's a great source of free cash flow to support the business in its endeavours. If they can't - because of ring fencing or escrow agreements etc - then in practice they know that there is little risk of needing to repay to parents, so may still be able to borrow against it or use it as collateral for that new property development finance arrangement, lease commitment or whatever.

My older sister went to a private school. I was sent to the local comp. She used to get up early and put her posh uniform on. She had to get a coach into the city. All her friends lived nowhere near so my parents had to drive her miles to their houses at the weekend. I used to walk to the comp in my scruffy uniform. All my friends lived nearby so I could walk to their houses when I wanted. Her A level results were poor so she couldn't go to a university or polytechnic and went to a college of higher education. My A level results were excellent so I studied a prestigious course at a top university. She has never earned more than the UK average salary. I have earned six figures for the last 16 years.
My wife is a teacher and when we had children we looked at private education. We went round a private boys grammar school which was rather dull. The local comp had much more equipment and as they specialized in the arts seemed far more exciting and vibrant. My wife's family are very anti-private so I think we were never going to pay for something that was freely available. A child attends school for 15% of it's time, sleeps for 33%. So what happens in the other 52%? We sent them to state school and paid for as many school trips as they could go on and then paid for lots of after school activities. Dance and music lessons. Sports. Scouts is fantastic and very cheap. We always have about 7 weeks of holidays a year when we explore the world with the children. This time is very valuable educationally. My son has now gone to study a prestigious course at an internationally renowned university one step higher than his dad! I think all A stars from a local comp is probably seen as better than all A stars from a posh private school. The worst thing you can do is to work harder to pay for private schools and then have less time with your children as a result. The other thing to say that some people don't seem to recognize is that the more selective a school is the better it's results are going to be! Simple statistics. Not rocket science.

I thought it was generally agreed that you are better not paying school fees up front for a small discount. It's hard to resist making a comment on a money saving forum about whether it is worth paying them in the first place. It is an enormous amount of money.