Education Trust

rockabelle

I'm due to have my first child next month, and my parents would like to put some money aside to go towards their education. Apparently you used to be able to set up an education fund - can you still do this? And does anyone know how/what the benefits are?

Many thanks

Belle

SqueekyMouse

I've been looking into putting money away for our DD too. I haven't come accross an Eductation fund at all.

The best savings accounts we found were with the Halifax - put upto £100 in a month for 1 year at 6%

And also a 5 year bond with the Yorkshire bank which allowed only one deposit and gave 4.25%

I'd be interested if anyone else has other suggestions...

jackyann

I have seen these, but a quick look through my bookmarks didn't bring any up. I think you need to Google & search.
The idea was that you saved like a trust, and didn't withdraw any money except for education purposes. I seem to remember there was one that included sports / athletics / music training as well as school fees.
My personal take is that as long as you get a good savings deal, you are better having flexibility - that's why I never pursued it. But other families may feel differently.

rpc

This would be a form of discretionary trust. The tax treatment of these is a bit more complicated than, for example, a bare trust but it would do the job. Basically, you set up the trust (with trustees) to provide for some defined purpose and then the trustees are free to use the money in the trust for the defined purpose.

I have no idea how to set one up, I suspect it would be wise to use a solicitor to draft the trust deed.

http://www.hmrc.gov.uk/trusts/types/discretionary-accum.htm