Managing school fees

School fees have risen faster than inflation and salaries over the last 20 years, which means that alternative ways of paying for them are becoming more popular. Michael Swan explores some options.

The UK’s current financial and economic position suggests that independent schools are in for a tough year. Despite the City’s exhortations that the worst is over, there is no doubt the recession will continue over the next 12 to 18 months.

This comes as little surprise, particularly given the fact that school fees have increased by 40 per cent over the last five years. Unfortunately, these fee increases have been allied with sharp rises in mortgage rates recently and a hefty decline in property values.
Since the last economic crisis, the proportion of middle-class families being made up of two income earners has increased markedly. While many families will be feeling ‘asset poor’, in terms of cash flow they are probably better off, with the load for paying household bills being shared.

Some people say that only doctors, lawyers and accountants can afford school fees, but this is clearly not true. Despite huge amounts of government funding being funnelled into the state education sector over the last ten years, the number of children attending independent schools has continued to rise. Many parents, whatever their economic circumstances, are clearly prepared to make financial sacrifices to ensure their children benefit from a private education.

The message schools should be conveying to parents is not “affordability” but “manageability”. It should be acknowledged that school fees have outstripped the rate of inflation for the last 10, if not 20, years. In all likelihood, this trend will continue into the foreseeable future.

Payment of school fees is clearly one of the largest financial responsibilities a parent will ever face. On top of this pressure, there is the stigma attached to parents who are struggling financially...