Saving for Children's education

TheMilkmansDad

Hi All,

Not sure if this is the best place to post but may as well start somewhere!

Our mortgage will shortly be paid of and rather than going nuts and spend a bit more on family luxuries I'm thinking it may be more prudent to start thinking of saving for kids futures.

At the moment both myself and OH are earning £40k+ and, as I understand it, were are kids to start University this year they would not qualify for the full student loan and we as parents would be expected to supplement the shortfall (and provide additional should it be required). So would now be a good time so start thinking of saving up for this? Kids are currently 9 & 11 so would be starting University (should trey choose to of course) in 8-10 years maybe.

I'm thinking of saving part of what the mortgage payments would be into either a Savings account or perhaps a few regular savers and transfer to fixed terms accounts on maturity. Does that seem like a feasible plan or would there be another path that may be more sensible?

Just wondering what anyone else may have done if they have been in a similar position?

Thanks in advance!

tacpot12

Saving for your and their future would be sensible. Given the time until they are likely to need it, you might want to consider investing what you can afford to save, say for the next five years or so. After that, save the money into a savings account or regular saver account and use this cash, plus what you would have otherwise saved when they go to Uni, and sell the investments when the first one goes to Uni. You can use fixed term accounts maturing each auttumn if you want to. If they don't go to University, the money might help them or you in other ways.

kaMelo

Similar to above, given the length of time you're talking about it would make sense to think about investing at least some of the money. The only thing I would add is that if they do choose to go to university don't use the nest egg to replace a student loan. Your children will be be far more appreciative of a house deposit than not having a student loan.

Cash-Cows

We have put two through university on similar incomes to yours. They took out the loan reduced as you say but the top up to cover accommodation and living came from not just us but their own money that they earned with holiday jobs. 

First year was the highest contribution but second and third years were a lot less. We didn't specifically save for years to pay for this as the sums were not substantial but that really depends on your outgoings. 

MSE_Helen_S

TheMilkmansDad said:

Hi All,

Not sure if this is the best place to post but may as well start somewhere!

Our mortgage will shortly be paid of and rather than going nuts and spend a bit more on family luxuries I'm thinking it may be more prudent to start thinking of saving for kids futures.

At the moment both myself and OH are earning £40k+ and, as I understand it, were are kids to start University this year they would not qualify for the full student loan and we as parents would be expected to supplement the shortfall (and provide additional should it be required). So would now be a good time so start thinking of saving up for this? Kids are currently 9 & 11 so would be starting University (should trey choose to of course) in 8-10 years maybe.

I'm thinking of saving part of what the mortgage payments would be into either a Savings account or perhaps a few regular savers and transfer to fixed terms accounts on maturity. Does that seem like a feasible plan or would there be another path that may be more sensible?

Just wondering what anyone else may have done if they have been in a similar position?

Thanks in advance!

We've built a calculator/estimator for this here at MSE: https://www.moneysavingexpert.com/students/student-loan-parental-contribution-tool/

Best to add a bit on for inflation as the calc is in today's money, but may give you a ballpark idea of what you could be expected to contribute to your child's living costs while at uni.