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School and University Fee Planning

Education, Education, Education A good education is one of the most valuable assets you can give a child, but the costs can be high. Even higher education has been hit by rising costs and according to The Natwest Student Money Matters Survey 2005, someone starting a 3-year course this year is likely to need £28,600 to see them through to the end.

Your children will need to remain financially dependent for longer and this is the first stage of financial planning that has not been appreciated historically. Older parents are finding that at the point in life where they would like to secure their own future incomes and savings, their children are now requiring more and more financial help.

The only way to stop the cycle and start your lifetime asset accumulation strategy from the 12-week scan.

So, why start early? The sooner you invest, the more time your money will have to grow. You can also benefit from 'compounding', which is the snowball effect you have when the growth your investment has achieved also starts to grow.

If you delay, you will probably need to invest much more to achieve similar returns and potentially take higher risks to obtain the returns you require.

Where do I start? You need to consider the following points:

* How much are the fees likely to increase annually * Your future disposable income and inheritances * The level of risk you are prepared to take with any investment * Your tax status now and when any investments mature

This is by no means exhaustive, but these points will form the backbone of any decisions you make.

Where does Aspen Financial Services Help? The range of investment and savings alternatives has grown in recent years and can include, Commercial Property, Cash, Government backed Gilts, Fixed Interest Securities as well as normal building society accounts.

Investments require monitoring and regular reviews to make sure you do not expose your investment to a higher risk profile than you are willing to accept.

Grandparents may also wish to be involved and where relevant, you can also consider, Fixed Term Annuities, which utilise a lump sum to produce a fixed-term guaranteed income to pay fees, or alternatively, they might wish to consider releasing equity from their home.

This can also work on the main family home, where we can consider the suitability of a 'drawdown' facility on your mortgage, which will give you a borrowing facility secured against your property. You only pay interest and capital on money you have draw.

Composition Fees Scheme Some schools let you pay upfront while guaranteeing you a discount on all or part of future fees.

The school will take a lump sum and subsequently pays the money into British Government or other fixed interest stocks, which guarantee both interest payments and capital redemption.

The schools normally achieve charitable status and therefore, do not pay tax on the interest received.