Financing your family's future
Worried about future costs? ClearStart, the leading fee free debt management provider, have put together some average costs for big life events, and offered advice on how to plan for them.
When you have children, you want to balance the ‘here and now’ with preparations for your family’s future.
There are so many important events on your son or daughter’s path to independence. Though you might not be under any obligation to contribute financially, a bit of forward planning can go a long way.
Once they’re ready to leave home, this journey may start with higher education.
What will university cost in 10 years time?
£67,000 is the predicted average cost of going through university a decade from now, according to the Institute of Fiscal Studies (IFS).
University tuition fees are no longer capped at £9,000 per year, however as it stands, tuition fee loans can cover the cost of your son or daughter’s chosen course.
From September 2016, maintenance loans are available to cover rent and living costs. Loans don’t need to be paid back until study has finished and the borrower is earning more than a certain amount.
Grants may be available for students with disabilities. They're also available to some students with dependants, or in receipt of certain benefits.
Some universities offer their own bursaries. These are awarded to students in financial hardship, or for people on certain courses.
Students can save money by studying online, or at a university close to home. By doing so, they can avoid renting a separate property or a room in student accommodation.
Studies have found that roughly 20% of young people find long-term partners whilst studying at university, which means that marriage could be the next step on your son or daughter’s path.
What does the average wedding cost?
A 2015 survey (by You & Your Wedding) found that the average wedding costs just under £21,000.
The same survey also found that 20% of people would choose to borrow money and get into debt for their dream wedding.
It’s possible to save money by doing more on your own, instead of hiring a makeup artist or florist. A pub is a cheaper venue than a fancy hotel, for a budget wedding reception. Saving money in advance can help your son or daughter to avoid any major wedding plan sacrifices.
Some young people choose to marry before purchasing a house. Others prefer the idea of setting up home before their wedding. Currently, there are many young people that doubt that they’ll ever be able to afford a home for their family.
How much will the average house cost?
According to mortgage lender Woolwich, the average house will cost £330,000 in 2025.
First time buyers might actually have a better chance of getting onto the housing ladder, but this is because there will be a larger selection of smaller properties available. These probably won’t have gardens or extra luxuries. Moving up the property ladder may be more of a challenge, which might mean that there won’t be as much space for your grandchildren to run around in.
How will you protect your family’s future?
If your children have plans to study, buy a house or get married, your financial planning can help them to achieve their goals.
Pay off debts
You will be in the best position to help if you don’t have your own debt hanging over you. You might be able to better manage your debt by budgeting more realistically, by seeking advice from companies like ClearStart, who can offer advice on the suitability of Individual Voluntary Arrangements (IVA), Debt Management Plans (DMP) or Debt Relief Orders (DRO), by filing for bankruptcy. .*
Choose to save
Being future-minded isn’t always easy. It can be tempting to live for today, taking the children on an expensive trip. It is important to create fun memories with your family, but these don’t need to cost a lot. Instead, go on a cheaper day out and put the money that you’ve saved into a piggy bank or savings account. Cut back if it’s practical. Perhaps think about whether you can sacrifice a TV entertainment package to build up a university savings fund.
Speak to an advisor
An advisor can help you to think through your options. It’s easy to become overwhelmed by the prospect of clearing debt or building up savings, but an emotional reaction probably won’t help your situation.
It is particularly important to act quickly if you’re in debt. Burying your head in the sand can make the problem last longer.
Seek help and advice from reputable sources, like advisors at ClearStart if you’re concerned about debt.
*This article was provided by ClearStart. For every Individual Voluntary Arrangement that starts with ClearStart on referral from FamilyLives, ClearStart will donate £500 to FamilyLives.
ClearStart is a trading name of Clear Start Partnerships Limited.
Call ClearStart on 0800 9887601 if you need advice.