School fees can be a large expense, though they needn’t be out of your financial reach. The sooner you start to plan the better, but even if your children have already begun their schooling elsewhere it's not too late.
As your children get older family finances naturally become stressed. There seems to be outgoings seemingly appearing and increasing all the time. When you the add school fees into the mix, it can all seem like it’s too much. However, spreading the cost of your children’s school fees beyond their schooling period means they can in fact be more affordable, whilst also maintaining your standard of living.
Borrowing
Equity within your property may be used to help fund school fees. In this event, Cedar Wealth Planning would ensure that a flexible mortgage is obtained to allow funds to become accessible when you need them as oppose to before you need them. This helps to minimise any interest payable on the mortgage. Then, the mortgage can be repaid within a sensible timeframe inline with your resources at your disposal.
Wealth generation
Although not directly available from school fees, tax relief can be arranged through investments that garner little taxable income or a significant tax relief. It may be beneficial to choose assets that when invested in, they create capital gains rather than income. This allows you to take advantage of your capital gains tax allowance, instead of being then taxed on further income produced.
School fees pension plan
A pension plan is often best for those who qualify. A pension plan enables you to build up a far greater pension fund whilst also paying off your school fees. In some cases, this can even generate tax relief greater than the original cost of the school fees themselves.
Strategies for higher rate tax payers
For those who pay a higher rate of tax, once your income exceeds £100,000 your personal allowance begins to erode. However, at Cedar Wealth Planning, we have a team of Independent Financial Advisers who can draft solutions that effectively provide you a tax relief of 60% at this level.
Contact Cedar Wealth Planning about School Fees Planning
Call us on 0121 411 0488 or email us using the form below:
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Some of the possible solutions are high in investment risk and will not be suitable for everyone. We would provide detailed recommendations to help you in this regard. Paying fees through a Limited Company have some complicated rules and may not be appropriate for all firms. Levels, bases of any reliefs from taxation may be subject to change and their value depends on the individual circumstances of the investor. The value of an investment can go down as well as up. Past performance is not a guide to future performance.