When and How Should I Start Saving for My Baby’s Education?

As a new parent, you have a lot on your plate, from antenatal appointments and prenatal care to ensuring your baby’s well-being. While it might seem early to think about it, planning for your child’s education can help set them up for a successful future without financial strain. In the UK, the cost of higher education is significant, and even primary or secondary schooling can come with its own expenses, especially if you’re considering private education. So, when should you start saving, and what’s the best approach?

This article will guide you through the process of when and how to start saving for your baby’s education, offering evidence-based advice and practical tips. By planning ahead, you can ensure that education costs don’t become a burden, and that your child has access to the best opportunities available.

When Should I Start Saving for My Baby’s Education?

The simple answer is: as early as possible! Starting early gives you more time to build up savings and benefit from compound interest, meaning the money you save will grow faster over time. Ideally, you should consider putting a plan in place even before your baby is born, alongside preparations for antenatal care and other pregnancy-related expenses.

Why Start Early?

The cost of education is steadily rising. As of September 2025, undergraduate tuition fees in England are expected to be £9,535 per year for full-time students and £7,145 per year for part-time students, excluding living costs. Private schooling can cost anywhere from £3,000 to £13,000 or more per term, depending on the institution. Brighton & Hove, for example, is thought to be the UK’s priciest private school, costing nearly £65,000 per year for full boarding. Some schools also require registration and administration fees and acceptance deposits and all of these costs are subject to quite tight payment deadlines from the time you begin the application process. Price break-downs can be intimidating and are usually publicly available, meaning anyone who knows where your child goes to school will know how much you are investing in your children’s education. Saving early means you can spread the cost over many years, making it less daunting.

It’s also important to remember that educational costs aren’t limited to fees. You’ll want to account for uniforms, extracurricular activities, books, technology, and potentially private tutoring. Planning early can ensure you’re financially prepared for each of these stages.

How to Start Saving for Your Baby’s Education

Saving for your child’s education requires careful planning. Here’s a step-by-step approach to get you started:

1. Open a Child Savings Account

One of the first steps is to open a dedicated savings account for your baby. This ensures that the money saved for their education is kept separate from your general finances, and you’re less likely to dip into it for other expenses.

Types of Savings Accounts:

Junior ISAs (JISAs): A Junior ISA allows you to save or invest up to £9,000 each tax year (2023/2024) for your child, and the returns are tax-free. There are two types: cash JISAs and stocks and shares JISAs. A combination of both could offer a balance of risk and reward. Stocks and shares JISAs tend to perform better over the long term but come with some risk.

Child Trust Funds (CTFs): These are no longer available to open, but if your child was born between 2002 and 2011, they may have a CTF in place. If so, you can continue contributing up to £9,000 annually. If you have a CTF, consider switching it to a Junior ISA, which might offer better returns and more flexibility.

Regular Savings Accounts: Some parents prefer to set up a simple regular savings account with a high interest rate. While these don’t have the tax benefits of JISAs, they can still be a useful option if you prefer to avoid stock market investments.

2. Consider Investment Options

If you have a long time horizon—perhaps 18 years until your child starts university—investing could offer higher returns than a regular savings account. Stocks and shares tend to outperform cash over the long term, although they do come with higher risks. If you’re unfamiliar with investing, it might be worth speaking to a financial advisor before diving in.

Some investment options include:

Junior Stocks and Shares ISAs: As mentioned earlier, these allow you to invest in the stock market with tax-free returns.

Investment Trusts: These can be a good option for parents looking to invest in a wide range of assets, spreading risk across different companies and industries.

3. Set a Monthly Saving Target

Consistency is key when it comes to saving for your child’s education. Set a realistic monthly target based on your income and other financial commitments. For example, even saving as little as £50 a month from your baby’s birth could accumulate to over £10,000 by the time they turn 18 (with interest or investment returns).

If you’re saving into a Junior ISA, keep in mind the annual limit of £9,000 (2023/2024). Use online calculators to help you determine how much you need to save each month to reach your goal, and remember that the earlier you start, the less you’ll need to save each month.

4. Factor in Inflation

When saving for long-term goals, it’s important to remember that the cost of education will likely increase over time due to inflation. Historically, the cost of tuition fees and living expenses has risen above the rate of general inflation. For example, between 2010 and 2020, UK university tuition fees more than tripled, rising from £3,000 to £9,250 per year.

To counteract this, consider investing in options that have the potential to outpace inflation, such as stocks and shares, rather than just relying on low-interest savings accounts.

Balancing Saving for Education with Other Financial Priorities

While saving for your child’s education is important, it’s essential to balance this goal with other financial priorities, such as saving for your own retirement and managing day-to-day expenses. It’s crucial not to stretch yourself too thin by trying to save for everything at once.

Budgeting for Baby Expenses

During the early years, you’ll face many new expenses for your baby, from nappies and baby gear to healthcare costs such as antenatal vitamins and antenatal support. Establishing a budget that factors in both short-term baby costs and long-term savings goals can help ensure that you’re managing both effectively.

It’s also important to take advantage of government support schemes such as Child Benefit and Tax-Free Childcare, which can provide financial assistance and help you save more for the future.

Saving vs. Investing

If your finances allow it, consider allocating a portion of your savings to more secure, low-risk accounts (such as cash ISAs) for short-term goals and emergencies, while investing for long-term goals like education.

Government Support and Savings Schemes for Education

The UK government offers several support schemes that can help you save for your child’s education. Familiarising yourself with these options can provide additional financial assistance.

Child Trust Funds (CTF)

As mentioned earlier, if your child was born between 2002 and 2011, they may already have a Child Trust Fund, which the government kickstarted with a voucher. You can continue contributing to this account or transfer it to a Junior ISA for better returns.

Child Benefit

Child Benefit is a monthly payment from the government that all parents are entitled to receive, regardless of their income (though there is a tax charge for higher-income earners). For the first child, the payment is £21.80 per week (2023), and for any subsequent children, it is £14.45 per week. While this may seem modest, over time, it adds up and could be a useful addition to your savings plan.

The Importance of Planning Early

As a new mum, your hands are full with antenatal appointments, prenatal care, and getting ready for your little one’s arrival. But planning for your child’s education early will help relieve future financial stress and give your child the best possible start in life.

Whether you decide to save via a Junior ISA, invest in stocks and shares, or set aside monthly savings, the key is consistency and starting as soon as you can. Even if you can only save a small amount each month, it will accumulate over time, and you’ll be thankful you started early when the time comes to pay for school uniforms, extracurricular activities, or university tuition fees.

By prioritising your child’s education now, you can help ensure that their future is bright, no matter what career path they choose to follow.