10 August 2021
According to new research1 from Brewin Dolphin, the wealth manager, many people vastly underestimate the cost of sending a child to university.
The survey results show that 9% of respondents believe it will cost under £20,000 to send a child to university, whilst another 30% estimate the figure between £40,000 and £50,000.
However, Brewin Dolphin research reveals if you want to pay your child’s tuition fees so that they leave university debt-free, you will need much more. Tuition fees are currently £9,250 per year, but living costs sgou, which are typically £795 per month2. According to Brewin Dolphin’s calculations, three years of tuition fees and living costs would amount to just under £75,000 in 15 years’ time, assuming an inflation rate of 2% per annum.
Amy Pethers, financial planner at Brewin Dolphin, says: “Raising a child is one of the most rewarding things you can do in life – but it can also be very expensive. To ensure you can give your children the opportunities you want for them, it’s crucial to plan ahead. And the financial burden can be more manageable if you put a solid financial plan in place.”
Brewin Dolphin’s research shows that if you invested £500 a month from your child’s third birthday, you could build up a pot worth just over £134,000 by the time they turn 18, assuming an annual return of 5% after charges. This could cover the cost of university tuition and living expenses (£75,000), leaving an additional £60,000 for a wedding or house deposit.
Interest rates on cash are currently very low, which means you’re extremely unlikely to achieve a 5% rate of return by leaving your money in a savings account or cash ISA. Investing your money offers the opportunity for higher returns, although you must be comfortable with the fact that investments go down as well as up.
PRESS INFORMATION
For further information, please contact:
Richard Janes richard.janes@brewin.co.uk / Tel. +44 (0) 20 3201 3343
Siân Robertson: Sian.Robertson@brewin.co.uk / Tel: (0) 20 3201 3026
Anita Turland: anita.turland@brewin.co.uk / Tel: (0) 20 3201 4263
Payal Nair payal.nair@brewin.co.uk / Tel: +44 (0) 20 3201 3342
NOTES TO EDITORS
Disclaimers:
- The value of investments and any income from them can fall and you may get back less than you invested
- The opinions expressed in this document are not necessarily the views held throughout Brewin Dolphin Ltd.
- Past performance is not a guide to future performance.
- This information is for illustrative purposes only and is not intended as investment advice.
- No investment is suitable in all cases and if you have any doubts as to an investment’s suitability then you should contact us.
- The information contained in this document is believed to be reliable and accurate, but without further investigation cannot be warranted as to accuracy or completeness.
- Brewin Dolphin is authorised and regulated by the FCA (Financial Services Register reference number 124444)
Brewin Dolphin is a UK FTSE 250 provider of discretionary wealth management. With £56.0* billion in total funds, it offers award-winning personalised wealth management services that meet the varied needs of our clients including individuals, charities and corporates.
We give clients security and wellbeing by helping them to protect and grow their wealth, in order to enrich their lives by achieving their goals and aspirations. Our services range from bespoke, discretionary investment management to retirement planning and tax-efficient investing. Our focus on discretionary investment management has led to significant growth in client funds and we now manage £48.7* billion on a discretionary basis.
Our intermediary business manages £17.6* billion of assets for over 1,700 advice firms either on a discretionary basis or via our Managed Portfolio Service, the MI Brewin Dolphin Voyager fund range and Sustainable MPS.
In line with the premium we place on personal relationships, we’ve built a network of 34 offices across the UK, Jersey and Republic of Ireland, staffed by qualified investment managers and financial planners. We are committed to the most exacting standards of client service, with long-term thinking and absolute focus on our clients’ needs at the core.
For more information, visit: www.brewin.co.uk
*as at 30th June 2021.