How to finance school fees

The real cost of education in 2025

School and university fees touch every family differently, yet the financial shape of the UK means many are looking beyond savings to make education work. The scale is stark. Higher education loan balances in England reached £266.6 billion in 2024-25, with repayments climbing to £5.0 billion as more loans enter repayment under frozen thresholds. Average English graduates now leave with around £53,000 of debt, and more than 150,000 borrowers owe over £100,000. Interest on newer Plan 5 loans is rising quickly, which pushes costs forward into early career years.

For parents and guardians, the picture for living costs is equally urgent. In England, the maximum maintenance loan covers roughly half of a typical first-year cost that exceeds £20,000 once setup and essentials are included. Over three years, living costs can reach £61,000 outside London and £77,000 in London, before tuition fees. That gap often falls back onto families, who must decide whether to save harder, work more, or borrow.

Independent school fees add another dimension. Even for those who have planned for years, increases in food, energy and staffing have kept fee inflation ahead of many household budgets. The question is not simply how to pay, but how to do so without derailing other goals like a first home, retirement savings or a rainy-day fund.

Understanding APR is not just about percentages - it is about knowing what you will pay in real terms across the life of the borrowing. Choosing the right route starts with clarity about timeframes, interest, and your ability to absorb payments alongside day-to-day costs.

A workable plan balances today’s classroom with tomorrow’s financial health.

A measured approach can lower stress. Map your fee timeline, compare funding routes side by side, then build in buffers. If borrowing is part of the mix, look closely at total cost and flexibility, not just the headline rate.

Who this guide is for

This guide is designed for UK families comparing ways to pay for independent school fees, university tuition and student living costs. It suits parents, guardians and mature students who want a balanced view of borrowing, saving and staged payments. If you are facing an immediate shortfall, considering longer-term support, or weighing up the impact of student loan choices, you will find a practical roadmap here. We focus on GB context and lenders, with particular attention to the pressures facing England-domiciled students and their families.

Your funding choices

1. Use existing savings or ISAs - immediate, interest-free, but reduces buffers.

2. Structured school payment plans - spread fees termly or monthly, sometimes with charges.

3. Personal loan for fees - fixed-rate instalments over 2-5 years via credit-checked lenders.

4. 0% purchase or money transfer credit card - short-term bridge if cleared within the promo.

5. Secured borrowing against property - lower rates, higher risk to home, longer terms.

6. Student loans for tuition and maintenance - income-contingent repayments for university.

7. Part-time work or internship income - offsets living costs without debt.

8. Family support or intergenerational lending - informal or documented, agree terms clearly.

9. Bursaries, scholarships and fee remissions - school or university assessed by need or merit.

10. Advance payment discounts - prepay to secure fee reductions where offered.

Costs, impact and risks at a glance

Who is eligible and what lenders look for

Eligibility depends on the route. For personal loans, lenders usually assess UK residency status, age, income stability, employment history, credit score and existing commitments. Lower incomes can face higher APRs, while higher earners often access lower rates. Typical terms range from two to five years, with affordability checks to confirm you can manage repayments alongside rent or mortgage, utilities and other regular bills.

Student loans for university are income-contingent, with eligibility based on domicile, course, institution and prior study. For England, Plan 5 is now dominant for new entrants, and while repayments only start over defined thresholds, frozen thresholds have lifted effective repayment rates relative to take-home pay. Maintenance loans are means tested and may cover only part of living costs, especially in London.

If you prefer a brokered route, Kandoo can connect you with a panel of UK lenders to compare unsecured options quickly. That can help families bridge short-term gaps without committing to a secured facility. Whichever option you choose, aim for clear documentation, full fee schedules and a plan for early repayment if your circumstances improve.

Step-by-step to arrange finance

1. Map total fees and timelines by term and year.

2. Check savings buffers and ringfence an emergency fund.

3. Compare borrowing options and projected total costs.

4. Test affordability against realistic monthly budgets.

5. Review credit report and correct any inaccuracies.

6. Get personalised quotes via a brokered panel.

7. Choose the best value option and complete checks.

8. Set up automated payments and review annually.

Weighing it up

Cautions before you commit

Before signing any agreement, stress test your budget. Model a 2-3 percentage point rise in borrowing costs and a short-term drop in income. If the plan still holds, you are less likely to be wrong-footed. Keep in mind that student loan dynamics are shifting. Balances and repayments have risen across England, with Plan 5 interest growing as a share of total costs. Maintenance support frequently covers only half of realistic first-year living expenses, which means families should plan for the gap in advance. Finally, watch for early repayment charges, rate step-ups after promotional periods, and any requirement to secure borrowing against your home.

Alternatives to borrowing

1. Apply early for bursaries, scholarships and fee remissions.

2. Negotiate school payment schedules or advance payment discounts.

3. Increase part-time work hours during low-stakes academic periods.

4. Use a dedicated education savings pot or JISA withdrawals where suitable.

5. Seek family support with a formal agreement and clear repayment rules.

Common questions

Q: Are personal loans suitable for school fees? A: They can be, especially for defined shortfalls over two to five years. The rate you receive depends on credit, income and existing commitments. Always compare the total cost.

Q: How do student loans affect long-term finances? A: Repayments are income-based above thresholds, which protects cashflow at lower earnings. However, balances can grow and thresholds may be frozen, so model repayments under different salary paths.

Q: Is a 0% credit card a good bridge? A: It can work for short periods if you clear the balance before the promotional rate ends. Factor in transfer fees and avoid letting it revert to a high APR.

Q: Should I remortgage to pay fees? A: Spreading costs over a longer term can reduce monthly strain, but you may pay more interest overall and your home is at risk if you cannot maintain payments.

Q: What if maintenance loans do not cover living costs? A: Many students face a gap. Combine budgeting, part-time income, bursaries and, if needed, a modest personal loan to avoid high-cost credit.

Q: Will applying through a broker affect my credit score? A: Brokers typically use soft searches to present options without affecting your score. A hard check occurs when you formally apply.

Move forward with confidence

If you are weighing options now, get clarity on the numbers and compare like for like. Kandoo can help you access a panel of UK lenders to find personal loans that fit your budget and timeline. A quick check can confirm eligibility and guide you to a solution that supports education without compromising long-term goals.

Small print

This guide is general information, not personal advice. Eligibility and rates depend on your circumstances. Borrowing is subject to status and affordability checks. Your home may be at risk if you secure borrowing against it. Terms can change.