Keeping up with the annual new school uniform hits your bank account right after the summer holiday has already made a serious dent.  The rate at which kids grow can seem to generate endless shopping trips for bigger sizes.  Shoes that only seem to have been worn for a few weeks are now too small.  Kids are expensive.

But what about when they take the next educational step and decide to go to University.  Fees will be £9,250 per year from 2017 – and that’s just for tuition.  Have you checked the monthly rent figures for flats and houses in University towns?  What about the money they’ll need for books, stationery, beer and take-outs?

If you have a child heading for University next year, hopefully you’ll have put some money aside.  But if your kids aren’t due to go to University for a few years it’s time to start planning so you can fund their fees – if they choose that route.

There are plenty of options depending on how many years you’ve got ahead of your first child getting to University entrance.

There was a time when a savings account would give you a good return, but with interest rates so low, that’s probably not the best way to build up an investment that will help to fund university fees.

The best bet currently seems to be a stocks and shares ISA as it benefits from investment growth.  Don’t confuse this with a cash ISA, as they are related to the current interest rate and at the moment, with such low interest rates are poor performers when it comes to adding interest to your cash investment.  Stocks and shares ISAs have the potential to be much better as they can benefit from rises in the stock market and generally show a better growth.

The down side is that they don’t really start to stack up unless they’ve been running for at least five years, when they are likely to show a much better yield.  After five years a monthly investment of as little as £150 a month could be expected to grow to cover at least the first year’s tuition fees.  Obviously, the longer you invest for, the better return you’re likely to get – although stocks can go down as well as up.

A financial advisor can explain why ISAs are an extremely tax efficient way to save money.

We’re not financial advisors and this information is based on our own research so please don’t just take our word for it!  We do recommend having a chat with a qualified financial advisor not only to ensure your children don’t come out of university with a massive debt hanging over their heads, but also to help you – and them – plan for the future beyond education.