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With A-level results day (13 August) rapidly approaching, research* from Rathbones, one of the UK's leading wealth and asset management groups, reveals the lengths many parents are prepared to go to help their children through university and avoid a significant student debt burden.
More than a quarter (26%) of parents who currently contribute, or expect to contribute, to university costs say they expect to provide more than £50,000 per child, while 11% expect to contribute more than £100,000. These costs can include undergraduate and postgraduate study, tuition fees, rent and other living expenses.
A further 16% expect to contribute between £50,000 and £100,000, while more than a third (34%) anticipate spending between £25,000 and £50,000.
While many families expect to draw on savings, investments and income, some anticipate taking more drastic measures to help meet education costs. As well as making broader retirement trade-offs, one in 10 (10%) expect to borrow, while a similar proportion expect to rely on financial support from wider family members. Meanwhile, 8% anticipate selling assets to help fund their child's education.
Ed Wood, Financial Planning Director at Rathbones, says: "Education remains one of the biggest investments many parents will ever make, but the cost of providing that support is rising sharply. 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.
"In conversations with clients, we often hear that helping children graduate without a large burden of debt is a key financial planning goal. Many parents see funding university as an investment in their child's future, but achieving that goal increasingly requires careful long-term planning and often involves balancing education costs against other priorities, including retirement."
Families still value university despite concerns over cost
Despite growing concerns about costs, the research found that nearly seven in 10 (69%) parents expect to cover at least half of the total cost of university – and most remain supportive of higher education.
Despite the financial commitment involved, most parents remain supportive of higher education. Almost half (45%) say they would actively encourage their child to go to university, while a further 20% would encourage university but with strong concerns about the financial implications. By contrast, just 2% would actively discourage their child from pursuing a degree.
However, parents are becoming more pragmatic about the value of a degree. Nearly half (46%) believe many well-paid careers still require a university education. At the same time, more than a third (37%) say student debt makes university less attractive, while a similar proportion (36%) believe apprenticeships and vocational routes offer a viable alternative.
Ed Wood says: “Parents haven't lost faith in university, but they are taking a more hard-headed view of its costs and benefits. Many still see a degree as an important route to a successful career, but they are increasingly weighing that against student debt, alternative pathways and a rapidly changing jobs market. For many families, the question is no longer whether university is worthwhile, but whether it represents the best route to achieving their child's ambitions."
The research comes amid growing scrutiny of higher education funding. Separate Rathbones analysis found that graduates on middle incomes can end up repaying significantly more in cash terms than higher earners because they remain in the student loan system for longer and accumulate interest over decades.
