4. What to Consider Now
If you’re thinking about private education, either now or in the future, here are key questions to reflect on:
- How will VAT affect your total cost over time?
- Could you use capital rather than income to fund school fees?
- Have you factored in multiple children or future university costs?
- Are you willing to adjust other plans, retirement, gifting, lifestyle, to make this viable?
- Could involving other family members reduce the burden?
These questions form the heart of our conversations with clients. We don’t just help you pay the fees, we help you build a purposeful, confident plan that protects your financial wellbeing.
Purposeful Wealth in Action
Private education can be a remarkable gift, and for many, one of life’s most rewarding investments. But it must be considered in the context of your whole life, especially now that costs are rising and VAT is a reality.
At Wells Gibson, we help families create space to reflect, test their assumptions, and plan with purpose.
“Purposeful wealth means aligning your money with what truly matters—without compromising your peace of mind.”
— Purposeful Wealth
Let’s Plan This Together
If you’re considering private education for your children or grandchildren, and wondering how rising costs and tax changes will impact your plans, we’d be delighted to help.
Book a discovery call to begin planning with clarity and confidence.
Important Information and Disclaimer
This blog is intended for general information purposes only and does not constitute personalised financial or investment advice. It reflects the views of Wells Gibson at the time of publication and is subject to change without notice.
While the content is based on sources we believe to be reliable, we cannot guarantee its accuracy or completeness. Any opinions expressed are not a substitute for tailored advice and do not constitute a personal recommendation.
Please note that the value of investments can fall as well as rise, and you may not get back the amount originally invested. Past performance is not a reliable indicator of future results.
Before making any financial decisions, we strongly recommend considering your individual circumstances and seeking independent, regulated financial advice.
Wells Gibson is authorised and regulated by the Financial Conduct Authority.
Planning with Purpose in the Face of Rising Costs
Choosing private education is one of the most significant financial decisions a family can make and one of the most emotionally driven. Whether you’re a parent planning ahead or a grandparent hoping to support future generations, the key question is not simply ‘can we pay the fees?’ But ‘can we afford this without compromising our wider goals and lifestyle?’
At Wells Gibson, we support families who want to align their wealth with what matters most. Through thoughtful conversations and purposeful planning, we help you understand what’s truly affordable and sustainable.
1. Understanding the Full, and Rising, Cost
It’s no longer just about termly fees. A meaningful plan needs to account for:
- Uniforms, extracurriculars, and school trips
- Annual fee increases (typically 4–6%)
- University costs or further education
- The number of children or grandchildren you may want to support
- And now, the confirmed addition of 20% VAT on private school fees
From 1 January 2025, private school fees were subject to VAT at 20%, with no tax relief available for most families. For example, a £15,000 annual fee could increase to £18,000, a significant jump that adds up quickly over multiple years and children.
Visualising Your Financial Future: A Wealth Plan in Action
At Wells Gibson, we don’t just create financial plans, we craft Wealth Plans: living, evolving frameworks designed to help you make confident decisions about your life and wealth.
One of the most powerful tools we use is Voyant, a sophisticated cashflow modelling system. It allows us to visualise your entire financial journey and test how decisions, like funding private education, impact the bigger picture.
Take a look at the image below. Although compact, it offers a detailed visual of a client’s lifetime financial plan, split into distinct life stages:
🔹 Saving (Blue Zones | Age 47–63)
We model income, savings, and surplus cashflows throughout your working life, incorporating:
- Salary growth, business income, or asset sales
- Pension contributions, investment strategies, and tax planning
- Large planned expenses, including school fees or property purchases
🔸 Spending (Orange Zones | Age 64–85)
As you transition into retirement, we illustrate drawdown strategies and:
- Lifestyle and travel goals
- Family gifting intentions
- Contingency planning for future care or unexpected costs
🟪 Later Life (Purple/Green Zones | Age 85+)
We include:
- Ongoing investment growth and tax efficiency
- Care cost assumptions
- Estate planning and legacy objectives
We also run multiple scenarios to stress-test your plan against inflation, market volatility, and tax changes, like the new VAT on school fees, so you can plan with clarity and confidence.
2. Priorities, Not Just Payments
It’s vital to look beyond the numbers and consider your wider aspirations. We’ll help you reflect on:
- Will private school fees affect your desired retirement date or lifestyle?
- Are there other meaningful intentions, such as buying a second home, supporting your family, or fulfilling personal experiences, you want to protect?
- Could your capital be used more purposefully elsewhere?
As Jonathan Gibson writes in Purposeful Wealth:
“You can afford anything, but not everything. Clarity around values turns trade-offs into confident decisions.”
We guide you through those trade-offs, so you can say “yes” to what matters most, with confidence and peace of mind.
3. Should the Family Share the Responsibility?
In some families, private education becomes a shared goal across generations. We frequently support clients with strategies such as:
- Gifting from capital – using available allowances or larger exempt gifts
- Discretionary or bare trusts – to structure fee payments tax-efficiently
- School fee investment plans – using ISAs, general investment accounts, or designated savings
When considered as part of a broader legacy or family wealth plan, private education can be made affordable and sustainable, without financial strain.
Let’s look at an example: “Peter and Anne”
Take Peter and Anne, a couple in their early 60s considering how best to support their grandchildren’s private education. With rising school fees and VAT now in place, they were unsure whether this would compromise their own financial security in retirement.
Using lifetime cashflow modelling, we tested various scenarios and found they could comfortably contribute £20,000 per year for seven years without affecting their retirement lifestyle, thanks to surplus assets and tax-efficient portfolio withdrawals.
For many families, this kind of thoughtful, values-based giving is not just affordable, it can be one of the most fulfilling ways to use wealth with purpose.
