Using IFISAs to Fund Private School Fees: A Comprehensive 2025 Guide
This is a financial promotion and is intended to provide information, not investment advice.
Planning for private school fees can be daunting. With average fees per term exceeding five figures and rising about 4–5% each year (see Atticus Financial Planning), many parents are seeking smart ways to grow their savings.
One tool gaining attention is the Innovative Finance ISA (IFISA) - a tax-free investment account that allows you to invest in peer-to-peer loans and other alternative fixed-income arrangements.
This expanded guide examines how IFISAs compare to traditional savings options like Cash ISAs and Stocks & Shares ISAs, explores broader investment strategies for education costs, and analyzes the risks of IFISAs with tips to manage them.
IFISA vs Traditional ISAs and Savings Options
When saving for school fees, it’s important to understand the differences between an IFISA and more common ISA types or savings products. Each has its own risk-return profile and role in a portfolio. Below is a detailed comparison:
Cash ISAs (and Cash Savings) vs IFISAs
A Cash ISA is essentially a tax-free savings account. You deposit cash and earn interest without paying tax on it. The big advantage of cash savings is capital security - deposits in bank accounts (including Cash ISAs) are typically protected by the Financial Services Compensation Scheme (FSCS) up to £85,000 per bank.
This means your money is safe from bank failures, making cash a low-risk choice. However, the trade-off for this safety is usually a low return. In fact, cash interest rates often struggle to keep up with inflation, meaning your money’s buying power can erode over time. As one financial planner notes, “most cash investments are not going to provide the returns that will allow the money being saved to retain its value in real terms ” when faced with rising school fees costs. In other words, while cash is secure, the returns may be lower than the inflation in education costs, potentially leaving a shortfall.
By contrast, an IFISA involves lending your money to borrowers (via peer-to-peer lending platforms or similar), aiming for higher interest returns. The interest earned in an IFISA is tax-free, just like a Cash ISA, but the expected returns are usually more attractive.
On average, IFISAs have advertised returns in the region of 4%-7% per annum (as per March 2025), which is significantly above typical high-street Cash ISA rates. Some IFISA providers even target slightly above 7% for certain loans. This extra yield comes with extra risk - unlike a cash deposit, the money you invest in an IFISA is not guaranteed or FSCS-protected if borrowers don’t pay back. You’re effectively acting as the lender, so if a borrower defaults on their loan, you could lose some of your capital or interest. It’s important to note that IFISAs are not “savings” accounts in the traditional sense; even though they may feel similar to depositing money, the risk is much higher than a normal cash account.
In summary, Cash ISAs vs IFISAs: a Cash ISA offers low-risk, modest, guaranteed interest (ideal for short-term needs or safety), whereas an IFISA offers higher potential returns with higher risk. Cash is best for preserving capital (especially if you’ll need the money in the next few years), while IFISAs aim to grow capital but can suffer losses. Many families may choose to keep a portion of their school fee fund in cash for near-term expenses, for peace of mind, and use IFISAs for a portion of funds they’re willing to put at risk for better growth. Always remember that with an IFISA “your capital is at risk… and not protected by the FSCS” (as IFISA providers often warn, so one should only invest an amount one can afford to fluctuate in value.
Stocks & Shares ISAs vs IFISAs
A Stocks & Shares ISA allows you to invest in the stock market (equities, funds, bonds, etc.) with all gains and dividends tax-free. Historically, equities have offered high growth potential – over the long run, a well-diversified stock portfolio might outperform most other asset classes. This means a Stocks & Shares ISA could, in theory, yield stronger returns than an IFISA over many years. For example, equity investments can sometimes achieve annual returns above 6% over the long term, whereas IFISA returns tend to be in the mid-single digits. However, stock market investments come with significant volatility. The value of a Stocks & Shares ISA can swing up or down with market conditions, and there’s no guarantee you won’t get back less than you put in if you need to sell during a downturn They are generally recommended only if you can invest for 5 years or more, to weather any short-term market drops.
Comparatively, IFISAs offer a more steady interest-based return (since you’re earning set interest on loans) rather than the unpredictable capital gains of stocks. IFISA returns are not volatile in the daily market sense – you typically earn a fixed interest rate on loans – but they carry credit risk (the risk that borrowers don’t pay). In terms of risk level, peer-to-peer loans via IFISAs are often viewed as higher on the risk spectrum than cash or government bonds, but not as high as stocks. This makes sense: with an IFISA you’re lending to individuals or businesses (which can default, but usually most will pay you back), whereas stocks represent ownership in companies (which can soar or crash in value based on market sentiment). P2P loans and IFISAs should be considered higher up the risk spectrum than cash or most bonds. In practice, this means IFISAs might provide more stable, bond-like returns (e.g. earning 5% consistently if all goes well) and are less volatile than equity investments, but they also lack the upside that stocks can have in booming markets.
Another key difference is liquidity and access. Stocks & Shares ISAs typically hold tradeable securities - you can sell investments on the market (though possibly at a loss if timing is bad) and withdraw cash fairly quickly. With IFISAs, your money is tied up in loans that have fixed terms (often 1 to 5 years). While some platforms, like easyMoney, have secondary markets or early withdrawal features, access is not always immediate or guaranteed. This means an IFISA is less flexible if you suddenly need the money, whereas a Stocks & Shares ISA, depending on holdings, might be liquidated faster (but again, market conditions matter).
In summary, Stocks & Shares ISA vs IFISA: Stocks ISAs offer the highest growth potential but with high volatility and risk of capital loss. IFISAs offer moderate, steadier returns without stock market swings, but still carry risk of loss through defaults and are not risk-free by any means. In fact, a crucial point is that if a company you invest in via Stocks & Shares ISA goes bust, you could lose money, but if a borrower in your IFISA loan goes bust, you could also lose money - and neither scenario is protected by the FSCS insurance. As one comparison notes: an IFISA might perform better than cash savings, like a Stocks & Shares ISA can, but if the borrower defaults, “you might lose it all” with no FSCS cover. Therefore, both Stocks & Shares ISAs and IFISAs are investment products with capital at risk, suitable for long-term investors who understand the risks. Many parents may actually use both: for example, invest some funds in the stock market for long-term growth (if their child is young and fees are years away) and some in IFISAs for more predictable interest income, achieving diversification.
Other Fixed-Income Investments vs IFISAs
Apart from ISAs, parents might consider other fixed-income investments to fund school fees - these include things like bonds, bond funds, or fixed-term savings accounts. How do these compare to an IFISA?
Government and Corporate Bonds: You can buy bonds directly or via funds. High-quality government bonds (like UK Gilts) have very low default risk, so they are relatively safe. However, their yields can be modest (often in the low single digits) and can be taxable unless held in an ISA. Corporate bonds offer higher interest than gov bonds but carry some default risk (though typically lower risk than P2P loans because you’re lending to large companies rather than small businesses or individuals). A well-diversified bond fund might yield a few percent annually and can be held in a Stocks & Shares ISA for tax efficiency. Bonds also have interest-rate risk: if you need to sell before maturity, the price can fluctuate with market interest rates. Compared to IFISAs, traditional bonds are more established and transparent investments. They usually yield less than what an IFISA advertises, especially after recent interest rate rises many high-grade bonds yield around 3–5% (as per March 2025). The risk profile is arguably lower for high-grade bonds than for the average IFISA loan portfolio, because major corporations or governments are less likely to default than a peer-to-peer borrower pool. However, bonds won’t typically give you tax-free interest unless in an ISA, whereas an IFISA’s returns are inherently tax-free.
Fixed-Term Savings Accounts and Other Deposit Products: Some parents opt for fixed-rate bonds (savings accounts) or children’s savings plans offered by banks. For example, a bank might offer a 5-year fixed savings account at a certain interest rate. These are essentially like Cash ISAs (or can even be Cash ISAs if within that wrapper) in that they are guaranteed and FSCS-protected deposits, just requiring you to lock the money for a period. The rates on these products have become more competitive recently but may still be a bit lower than the potential IFISA returns. The benefit is certainty: you know exactly what interest you’ll get and your capital is safe at maturity. The downside is any interest above your Personal Savings Allowance (PSA) could be taxed if not in an ISA (basic-rate taxpayers currently have £1,000 interest tax-free per year, higher-rate have £500). So, large balances might incur tax on interest unless you utilize an ISA. With an IFISA, all interest is tax-free by design, which is a big plus if you accumulate a sizeable fund.
Peer-to-Peer and Crowdfunding (outside an IFISA): It’s worth noting that one can invest in P2P loans or crowdfunding projects even without an IFISA, but then any interest earned would count as taxable income. If parents are considering P2P lending as a way to earn extra income for school fees, using the IFISA wrapper is generally wise because it shelters that interest from tax. For instance, one scenario illustrates that investing in P2P outside an ISA can quickly lead to a tax bill on interest once you exceed the PSA, whereas inside an IFISA you’d keep 100% of the interest. Maximising tax-free growth can significantly impact long-term outcomes, especially for a goal as expensive as education.
In summary, IFISA vs other fixed-income: IFISAs are part of the broader fixed-income family (since they deal in loans), but they tend to offer higher interest by lending to less-established borrowers (like small businesses, consumers, or property developers via crowdfunding). Traditional fixed-income (like bonds or bank deposits) is generally lower-risk and lower-return. An IFISA can complement these: for example, you might hold some stable bonds or fixed deposits for safety, and also an IFISA for a portion of your money to try to get extra yield tax-free. The key is to balance reliability with growth – which leads into the importance of diversification.
Diversified Investment Strategies for School Fees Planning
Funding private school fees is a long-term project - often spanning several years or even over a decade of payments. Because of this, it’s crucial to adopt a diversified investment strategy rather than relying on any single product. Diversification means spreading your investments across different types of assets and accounts, so that no one setback will derail your entire plan. Here are some broader strategies and considerations for parents:
Mix Growth and Safety: A common approach is to use a core-satellite strategy. For example, you might use stocks and equity funds (via a Stocks & Shares ISA) as the growth engine for expenses that are many years away (e.g. if your child is still in primary school and you’re building a fund for secondary or senior school fees in 5+ years). At the same time, you could allocate some money to IFISAs or bond funds as a middle-ground investment – these can provide regular interest income and are less volatile than stocks, which is useful as you get closer to needing the money. Finally, keep a portion in Cash ISAs or savings for short-term fees due in the next 1- 2 years (or for an emergency fund). This way, you’re not forced to sell investments at a bad time to meet a tuition bill; the near-term fees are covered by cash reserves, while longer-term fees are funded by investments that have time to grow.
Align with Your Timeframe: The timing of when you’ll need the funds should guide your investment choices. A widely followed rule is: if you need the money within the next five years, keep it in cash or very safe instruments, not in risky investments. This is because a shorter timeframe gives you little cushion to recover from any market downturn or unexpected loss. On the other hand, if you have more than five years before you need to draw down the funds, you can afford to take more risk to try and beat inflation. For instance, if your child is born now and you’re investing for school fees in 10 years, you could invest in higher-growth assets (stocks, IFISAs, etc.) now, and gradually shift those into cash or short-term bonds as the time to pay fees approaches. By the time your child is about to start school, you’d want a significant portion of the first few years of fees in a safe place. This phased approach helps smooth out volatility - it mirrors the concept used in target-date investing, where you reduce risk as the goal date nears.
Use Both Parents’ Allowances and Accounts: Remember that each parent has a £20,000 ISA allowance per year (current limit). By utilising ISA allowances fully, a couple could, in theory, invest up to £40,000 per year combined towards school fee goals in various ISAs. Over several years, this makes a huge difference. You might split contributions such that one parent maxes out a Stocks & Shares ISA while the other uses an IFISA, or any combination that fits your plan. Also, consider Junior ISAs for long-term education planning - though note that money in a Junior ISA can only be accessed by the child at age 18, which is typically after school years (useful for university, but not directly for school fees). Some families also involve grandparents in planning: grandparents can gift money into ISAs or other investments, or pay fees directly, which may have additional tax/planning benefits (like reducing their estate for inheritance tax). All these angles contribute to a diversified funding strategy.
Diversify Within Each Category: Diversification isn’t just across stocks vs bonds vs cash - it also means within each category, spread the risk. For stock investments, that means investing in a broad range of companies or via funds/trackers rather than a few individual stocks (to avoid one company’s troubles sinking your fund). For IFISAs, it means ensuring your IFISA is spread across many loans or projects, not just one big loan. Fortunately, most IFISA platforms do this automatically: your IFISA investment is typically split among a large number of individual loans to different borrowers, which helps reduce the impact if one loan defaults. You can also diversify by using different types of IFISA providers - for example, one IFISA may focus on property-backed loans, like easyMoney IFISA, another on small business lending, etc., giving you exposure to different sectors. (Be mindful, however, that you can only subscribe new money to one IFISA per tax year; to use multiple IFISA providers, you might contribute in different years or transfer ISAs between providers.) If you’re unsure which route (cash, stocks, or IFISA) is best, you don’t have to choose just one - ISA rules allow you to split your £20k allowance across different ISA types in a given. For example, you could put £10k into a Cash ISA, £5k into a Stocks & Shares ISA, and £5k into an IFISA in the same tax year (as long as the total is within £20k). This flexibility means you can diversify your approach while still keeping all the earnings tax-free.
Regular Contributions and Rebalancing: Building a large fund for school fees is often compared to saving for retirement - starting early and contributing regularly can reduce the burden. Setting up a monthly contribution to your chosen ISAs (sometimes called “pound-cost averaging” in the context of investments) can help smooth out market fluctuations and instill discipline. Over a decade, even modest monthly deposits can grow significantly, especially if invested in higher-return assets early on. It’s wise to periodically review and rebalance your allocations. If one part of your portfolio grows faster (say your stocks have a great run), you might rebalance to move some gains into safer assets for the upcoming tuition payments. Conversely, if markets dip, you might hold off withdrawals from investments and use cash reserves, giving investments time to recover. The key is to remain flexible and adjust the plan as conditions change, all while keeping the ultimate goal (having funds available for each term’s fees) in focus.
Plan for Withdrawals and Cash Flow: A strategy often overlooked is planning how you will withdraw and use the funds when the time comes. Private school fees are usually paid termly or annually. It’s prudent to have at least a year’s worth of fees in liquid form by the time the child is about to start school. You might use interest from investments to pay some of the fees along the way. For instance, if an IFISA is yielding 5%, you could use that interest payout towards a portion of the fees each year, while preserving the principal for future years. Some IFISA platforms pay interest monthly or quarterly – a feature that could align well with regular fee payments (though keep in mind the interest can vary if any loans default). Meanwhile, assets like stocks might need to be sold gradually; ideally, plan to sell stocks a bit ahead of the fee due date (e.g. sell some investments each summer to fund the next school year’s costs) rather than being forced to sell at a specific time regardless of market conditions. Having a clear withdrawal plan ensures that your diversified investments actually translate into cash when the school sends the bill.
In essence, a broad investment strategy for school fees might involve using multiple tools together: safe cash for immediate needs, IFISAs and bonds for medium-term steady growth, and equities for long-term growth – all within tax-efficient wrappers like ISAs so that you aren’t losing money to taxes. Diversification and prudent planning can help reduce risk while aiming for the returns needed to meet ever-rising education costs.
Risks of IFISAs and How to Mitigate Them
While IFISAs can be attractive for their tax-free higher interest, it’s crucial to have a clear-eyed understanding of their risks. As with any investment promising better returns, there are no guarantees. Here we delve deeper into the specific risks associated with IFISAs and strategies to manage them:
Borrower Default Risk: The most obvious risk in an IFISA is that borrowers may default on their loans. When you invest through an IFISA, you’re often lending to peer-to-peer borrowers, small businesses, or property developers. These are typically segments that banks might consider higher risk, which is why they’re willing to pay higher interest to attract investors like you. If a borrower fails to repay, you could lose the interest from that loan and even part of your initial capital. Unlike a bank, which spreads risk across thousands of loans and has capital reserves, your investment is directly exposed to each borrower’s ability to pay.
Diversification is the first line of defense here. As mentioned, ensure your IFISA money is split across many loans – this way, one bad apple has a limited effect on your overall return. Fortunately, most IFISA platforms do this automatically or allow you to invest in a pooled fund or auto-lend product.
Additionally, some platforms have a provision fund or reserve fund that aims to cover losses if borrowers default. This is a kind of insurance buffer – for example, if one borrower defaults, the platform’s reserve fund may compensate investors from that pool (either fully or partially). However, note that not all IFISA providers offer this, and those that do usually state that it’s not a guarantee, just a target protection. You should check the track record: how has the platform’s loan default rate been historically, and have they been able to make investors whole via their provision fund?
Lastly, consider the type of loans: some IFISAs invest in secured loans (e.g., loans secured against property or other assets) which can reduce loss severity – if the borrower defaults, the asset can be sold to recover some funds. Secured loans (common in property IFISAs) tend to be less risky than completely unsecured personal loans.
Platform Risk: When you use an IFISA, you’re dealing with a specific P2P or investment platform that manages the loans. There is a risk that the platform itself could encounter financial difficulties or go out of business. If the company running the IFISA fails, it could disrupt your access to funds. The good news is that IFISA providers in the UK must be FCA-regulated and have “wind-down plans” in place. A wind-down plan is essentially a strategy to continue servicing the loans (collecting borrower repayments and returning money to investors) even if the platform shuts to new business.
Before investing, research the platform’s credentials. Ensure they are FCA-authorised and look for information on their site about how they protect investors in a wind-down scenario. You can even check their authorisation on the FCA register and look at Companies House for their financial filings.
Consider platforms that are well-established, like easyMoney, have transparent operating histories, and adequate capital reserves. Some platforms might segregate client funds (the cash waiting to be lent out or just repaid) in separate accounts for safety. While you as an individual cannot control the fate of a platform, being with a reputable one and not chasing an unknown startup for a slightly higher rate can reduce the risk of platform failure. It’s also possible to diversify across platforms (e.g., split your IFISA allowance over different providers in different years) to avoid having “all eggs in one basket” institutionally.
No FSCS Protection: As highlighted earlier, one stark difference between IFISAs and traditional bank savings is the lack of government-backed insurance on your investment. If a borrower doesn’t pay or the platform collapses, you cannot claim compensation from the FSCS for losses on the loans. The only portion that might ever be FSCS-protected is any idle cash you have not yet lent out on the platform, depending on how/where it’s held – some platforms hold uninvested cash in an FSCS-protected account, but once it’s invested in loans, that protection is gone.
There’s no way to add FSCS protection to an IFISA, so the only mitigation is prudence. Consider IFISAs as the higher-risk part of your portfolio and don’t rely on them as your sole safety net. You might decide to cap the portion of your total school fees fund that you allocate to IFISAs - for instance, maybe no more than 20-50% of your total education savings, depending on your risk tolerance. That way, even in a worst-case scenario, other funds (cash, bonds, etc.) can cover the essentials. Understand the risk warnings provided: every authorised platform will remind you that “Capital is at risk and not protected by the FSCS”. Take those warnings seriously in your planning.
Liquidity Risk: IFISA investments are not as liquid as a bank account. When you put money into an IFISA, it gets lent out for a term - often several months to years. Often you cannot simply withdraw on a whim as you would from a savings account.
Some providers, like easyMoney, offer a secondary market where you can sell your loan parts to other investors if you need to exit early, but this depends on finding a buyer and may involve fees or discounts. In stressed market conditions (say, a recession) secondary markets can seize up with few buyers.
Plan your investment horizon conservatively. Only invest money that you won’t need on short notice. If you anticipate needing a certain amount by a certain date (e.g., next year’s school fees), it’s safer to not invest that chunk in an IFISA, or to ensure it matures before then. Some IFISA products allow you to choose loan term lengths - you might select loans that end around the time you’ll need funds, staggering them to match fee payment dates (this is akin to a bond ladder strategy). Also, maintain an emergency fund outside the IFISA so that if you do face an unexpected expense or delay, you’re not forced to scramble. Essentially, treat IFISA investments as relatively illiquid and only commit funds that can stay invested for the intended duration. If your platform has withdrawal options, familiarize yourself with the process and any costs involved beforehand.
Economic and Interest Rate Risk: The performance of your IFISA can be influenced by broader economic conditions. For instance, in an economic downturn, more borrowers might default or pay late, impacting your returns. If the loans are tied to property and property values fall, recoveries on defaulted loans might be lower. Additionally, if interest rates in the wider economy rise sharply, new loans will start offering higher rates, making your existing loans comparatively less attractive (though you still get the agreed rate, it’s an opportunity cost). That can also affect liquidity – no one will buy your 4% loan part if new ones are paying 7%, for example.
Not all of this can be controlled, but you can mitigate by staying informed and being cautious during risky times. For example, if economic signs suggest rising defaults, you might choose to pause reinvesting your interest, or even gradually reduce your IFISA exposure, shifting to safer assets. Some investors diversify even within P2P by choosing platforms focused on different sectors (consumer lending, business lending, property, green energy projects, etc.) because different sectors have different economic cycles. By spreading across sectors, you avoid concentration in the one area that might get hit hardest in a downturn. Moreover, consider the loan quality – many IFISA platforms classify loans by risk bands; you might stick to higher-quality borrowers (albeit at lower interest rates) if you are risk-averse, rather than chasing the highest yield loans which often carry more risk of default. As always, keep an eye on the platform’s health too - if the platform starts reporting unusually high default rates or other issues, that’s a cue to be cautious.
Regulatory and Tax Considerations: While not a risk to your money per se, it’s worth noting that regulations and tax rules can change. IFISAs were introduced in 2016 and the sector has evolved under regulatory oversight. Changes in rules could affect how IFISAs operate or the types of investments allowed. Additionally, the tax-free status of ISAs could in theory be adjusted by the government (though there’s no indication of that right now – ISAs have been a stable policy for decades).
Keep abreast of any news regarding IFISA regulations. All IFISA providers are required to treat customers fairly and comply with FCA rules, including ensuring investors understand risks (you may have noticed you often must pass an “appropriateness test” questionnaire when signing up, to show you understand P2P risks). Make sure to read any communications from your provider about changes or updates. As for tax, currently all IFISA returns are tax-free, which is a strong advantage. If you ever invest in similar products outside an IFISA, remember those interest earnings could be taxable – plan for that accordingly (or seek to transfer those into an IFISA when possible). And as always, if you feel unsure about the regulatory or tax aspects, consult a professional for clarification.
Psychological Risk - Don’t Overestimate Stability: One subtle risk is assuming an IFISA return is a sure thing because it’s advertised as a fixed rate or because you see interest landing each month. There’s a psychological comfort in seeing steady interest payments (in contrast to a stock portfolio that might be down 10% one quarter and up 15% the next). This might lead some to put too much into IFISAs under the impression that it’s a stable income investment. It’s important to remember that the interest “promised” by loans is not guaranteed – things can change if loans default. Mitigation: Maintain the mindset that an IFISA is an investment with risks, not a fixed deposit. Treat the interest you receive as a target, not a guarantee. A good practice is to periodically stress-test your plan: ask, “What if my IFISA returns 0% (or negative) for a year or two due to defaults – do I have a backup plan to cover fees?” If the answer is yes (maybe because you have other savings or you’re only using IFISA for optional extras), then you’re using the IFISA prudently. If the answer is no (your plan assumes the IFISA will definitely yield 5% to afford school each year), then you may be over-relying on it. Adjust by diversifying or reducing that reliance.
In light of these risks, FCA regulations require that IFISA providers present clear risk warnings. Many platforms explicitly state disclaimers such as: “Capital at risk. Don’t invest unless you’re prepared to lose money. This is a high-risk investment. You may not be able to access your money easily and it is unlikely to be covered by the FSCS if something goes wrong.” As an investor planning for something as important as your child’s education, you should take those warnings to heart. The best strategy to mitigate risk is knowledge and caution: fully understand what you’re investing in, diversify your approach, and don’t hesitate to seek independent financial advice if you’re unsure about any product. Remember that tax-free returns mean nothing if you lose your capital - so never let the tax perk alone drive your decision.
Conclusion: Balancing Growth and Security in School Fee Planning
An Innovative Finance ISA can be a valuable addition to your toolkit when planning for private school fees. Its appeal lies in the tax-free, potentially above-inflation returns that can boost the growth of your education fund. When bank savings accounts are barely keeping up with rising fees, an IFISA investment yielding 5% or so per year, compounded, can make a meaningful difference. Over a span of several years, those tax-free interest earnings could cover a significant portion of a term’s fees or reduce the amount of principal you need to contribute out-of-pocket.
However, an IFISA should never be viewed in isolation or as a guaranteed solution. It carries more risk than traditional savings methods - a fact any responsible discussion must highlight. By comparing IFISAs with Cash ISAs and Stocks & Shares ISAs, we see that each has pros and cons: Cash ISAs offer safety but low returns, Stocks & Shares ISAs offer high returns but with volatility, and IFISAs sit in between - offering attractive returns with risk mitigated by property-backed loans. The right approach for most families will be to combine these tools, not choose one versus another outright. Diversification, as emphasized, is key. A well-diversified plan could mean that even if any investment underperforms in a given year, other investments (or a partner’s income, or savings) can fill the gap, ensuring the school fees are paid on time.
Maintaining a professional, level-headed perspective will guide you to make prudent choices. Always plan for the worst-case scenario (could you still fund the fees if an investment didn’t deliver as expected?) while striving for the best case. By doing so, you can sleep easier at night knowing that your child’s education fund is on track and resilient. It’s wise to periodically revisit your strategy, especially as each school term or year passes, to adjust contributions or allocations as needed.
Finally, remember this is not personal financial advice. The information provided here is meant to inform and educate on the options available. If you are ever uncertain about how an IFISA or any investment fits into your personal circumstances, consider seeking independent financial advice. Every family’s financial situation and risk tolerance is different, and a professional can provide tailored guidance.
In conclusion, an IFISA, like easyMoney flexible IFISA, can play a role in funding private school fees by turbocharging your savings through tax-free investing and attractive interest rates. Used alongside traditional ISAs and other investments as part of a diversified plan, it can help bridge the gap between what you have and the growing cost of education. Just approach it with eyes open to the risks, manage those risks carefully, and leverage the benefits responsibly. With the right balance of growth and security, you can build a robust financial foundation for your child’s schooling years giving you one less thing to worry about as you focus on their future success.
Capital is at risk. Past performance is no guarantee for future results.
Tax treatment depends on the individual circumstances of each investor and may be subject to change in the future.