As A-level results approach, many parents are preparing to financially support their children through university. Research indicates that 26 percent of parents who contribute or plan to contribute expect to spend more than £50,000 per child. This figure encompasses tuition fees, accommodation, and living expenses for undergraduate or postgraduate studies, which typically last three to four years.
Financial Commitments
A study by wealth manager Rathbones found that 11 percent of contributing parents anticipate expenses exceeding £100,000 per child. An additional 16 percent estimate costs between £50,000 and £100,000, while 34 percent expect to spend between £25,000 and £50,000. For the 2026-27 academic year, tuition fees in England are set at £9,790 annually for most full-time undergraduate courses. Maintenance loans are available for living expenses, with maximums of £10,830 outside London and £14,135 in London for those living away from home, though these are means-tested.
Funding Challenges
Some parents are exploring various avenues to fund their children's education. According to the Rathbones survey, one in ten parents expect to borrow money, a similar proportion plan to rely on financial support from extended family, and approximately 8 percent anticipate selling assets. Despite these financial pressures, a majority of parents remain supportive of higher education. Nearly half (45 percent) actively encourage their child to attend university, while 20 percent encourage it but express strong concerns about the financial implications. Only 2 percent would actively discourage their child from pursuing a degree.
Ed Wood, financial planning director at Rathbones, highlighted the rising costs and the financial strain on households. "Education remains one of the biggest investments many parents will ever make, but the cost of providing that support is rising sharply," Wood stated. "What's striking is that some families expect to borrow, sell assets or rely on wider family support to help fund university, highlighting the financial pressures many households face."
Student Loans and Banking
The system of student loans has faced criticism, particularly regarding high interest rates. Graduates on Plan 2, who started university between September 2012 and July 2023, report that interest can accumulate faster than their repayments, leading to growing debt. Interest rates for these borrowers vary based on income, with those earning over £52,885 facing a 6.2 percent rate this year, capped at 6 percent from the 2026-27 academic year. In July, a government report accused authorities of mis-selling student loans, and the Treasury Select Committee concluded that the student loan system is "broken and unfair," urging the government to reverse the freezing of repayment thresholds for some loans.
Choosing the right student bank account is also crucial. These accounts often include benefits such as interest-free overdrafts, which help manage costs but require repayment after graduation to avoid interest charges. Some accounts offer perks like free Railcards, Tastecards, or cashback rewards.