The cost of obtaining a university degree is one of those thoughts you have regarding your child’s future, and then swiftly put to the back of your mind. In the early years, you’re so busy, so consumed with the basic tasks of parenthood that considering such a thing feels almost redundant. You’re having enough trouble keeping everything as it should be in the moment, never mind 18 years from now!
While this is necessary and oh-so-understandable, it’s also worth bearing in mind that this is where many parents have a tendency to cause themselves problems. They put it off for so long, thinking that the costs are so far in the future, and suddenly that future rolls around faster than they were ever ready for. Then, to avoid their child beginning their life with a ton of student debt around their necks, they find themselves contemplating quick fixes to contribute to university fees, considering all comers from secure loans to a full-blown remortgage of their home.
While these measures do work, they are not the most financially savvy way of seeing your child through their education. The last thing you want to do is jeopardise your own finances for the sake of helping theirs; especially when there might be an inevitable knock-on effect. So what’s the best solution for parents who want to contribute something, but also don’t feel comfortable putting huge chunks of money aside from an early age?
Decide What You’re Financing
The cost of a degree is around £20,000 – it varies by institution. Bear in mind also that that’s the figure today; with inflation, if you have a 10-year-old, the price could soon be around the £24,000 mark. Then there is the cost of living fees to add onto that. Students can sometimes capture bursaries, but there is only a finite number of these, so it’s best to plan on it not being an option.
If you don’t want your child to have to take out any kind of financing at all, then you need to start saving as early as possible. The more you can save, the better; bear in mind that if you start saving now, you have potentially 18 years of interest to accrue. Interest rates may be bad at the moment, but even on a 2% account, you could earn a lot before day one of university.
Funding Tuition Only
If you don’t think that you can afford to save for both living and tuition expenses, then the most important priority is tuition. Living expenses can come from a student loan or overdraft; alternatively, your child might get a job to see them through their studies. This will still be substantially less than if you had not been able to pay their tuition, so you’re still definitely giving them a leg up in life.
It’s Okay If You Can’t Save
With household budgets stretched tighter than ever, it might simply not be good economical sense for you to start saving at this point. The amounts you put aside should be small and forgettable, not huge chunks from your budget. Even if you only save £100, that’s £100 less debt your child will begin their career with – it all counts.