A guide to the best savings plans and investment options for UK expats looking to fund their children’s education, both locally and internationally

If you’re an expat looking to send your child to an international school, fees can vary widely, from around £5,000 a year at more affordable options to over £25,000 at top-tier schools in cities like Dubai or Shanghai — sometimes costing even more than Eton or Harrow.

University fees aren’t usually covered by UK student loans when you’re abroad either, which means the cost of educating your kids can stack up pretty quickly. That’s why it’s best to plan and save well in advance.
In this guide, we’ll help UK expats get the best education possible for their children by taking advantage of tax-efficient saving options and investments.

WHY PLANNING EARLY COULD SAVE YOU THOUSANDS
When saving for your children’s education, it pays to start early.

Let’s say you start saving £250 a month as soon as your child is born. By the time they turn 18 and assuming a return of around 5% a year, you’ll have around £87,000. Only £54,000 of that is actual contributions, the other £33,000 comes purely from compound growth.

If you wait and don’t start saving until your child is ten years old, even putting in the same amount each month at the same rate only leaves you with around £29,000 by the time they reach 18. It’s a surprisingly big difference.

Don’t worry if you’ve left it late though, as it’s never too late to start.

The important thing is to set up a sensible savings strategy, no matter which stage you’re at. This might mean supplementing a smaller education pot with a flexible investment account or research scholarships. You might even decide to take on more risk to make up for lost time.

The important thing is to start now, even if it feels too late or the amount seems small. Any money you can save between now and your child starting education will help.

WHAT KIND OF EDUCATION ARE YOU REALLY SAVING FOR?
This is such an important question, because when we say “saving for education,” it’s easy to assume we all mean the same thing.

The truth is, the country you live in, the type of school you choose, and where your child might go later all affect the overall cost of education for expats.

International schools are often quite pricey. Local state schools are usually cheaper or free, but they’re typically in the local language, which could pose a real barrier if your child isn’t fluent in the local language, is older, or plans to return to the UK later.

In popular expat areas, local schools are often oversubscribed with priority given to residents or nationals. In this case, international schools might be the only option.

In terms of university, as an expat you’ll often foot the entire bill as UK student loans won’t apply. This could cost several thousand or more per year.

So, before you do anything else, ask yourself – Where do I see my child being educated in 5 or 10 years?

Are you planning to settle abroad over the long term? Do you want your kids to go to a UK university? Would you consider boarding school in the UK while you’re overseas?

The answers to these questions help shape everything, including how much to save and how to save it.

HOW TO CHOOSE THE RIGHT SAVINGS PLAN
As an expat saving for your children’s education, you’ll need to decide between a structured plan or a flexible one.

• A structured education savings plan commits you to saving a set amount every month, usually for a period of 10 to 20 years. You get bonuses or growth incentives for sticking with it, but have to pay penalties if you opt out early.
• A flexible platform-based plan is more like a pay-as-you-go gym pass. You can save as much or little as you want and change or pause them entirely. There’s no bonus for commitment, but you also don’t get penalised if you need to change things up.

If your income is stable and you value structure, then a structured plan is a good motivator. But if you’re moving often or your income fluctuates, flexibility might suit you better.

There are three main options when it comes to the types of education savings accounts.

• Junior ISAs are available if your child is still considered a UK-resident. You can save up to £9,000 per year, tax-free, and the child gets control at 18. Unfortunately, they’re unavailable to many expats due to residency issues.
• Offshore savings accounts are held in stable jurisdictions like Jersey. They’re good if you want multi-currency flexibility and easy transfers.
• Trusts are more advanced legal structures to manage assets on your child’s behalf. They enable you to control when and how money is accessed and offer protection if something happens to you. You can opt to maintain control beyond the age of 18 if you don’t want to give your child full access straight away.

The main thing is to choose a plan that suits your income, how often you move, how much control you want, and how much risk you’re comfortable with. It’s usually a good idea to consult with a financial advisor who is knowledgeable about expat finances to help you make the best long-term decision.

DON’T SAVE IN THE “WRONG” CURRENCY
Some expats fall into the trap of treating all currencies the same. If you’re saving for your child’s education in the UK, but all your savings are in euros or dollars, then exchange rate changes might mean you’ve actually saved less than you think.

For example, let’s say you’ve saved the equivalent of £100,000 in your local currency for UK school fees. The pound suddenly strengthens and your local currency drops 10%. Overnight, your pot is cut to £90,000. You could lose a whole year’s worth of tuition due to an unavoidable exchange rate shift.

That’s why it’s usually best to save in the currency you expect to spend in.

If you think your child will go to school or university in the UK, then save in pounds. If they’ll study in the country you’re living in now, save in the local currency. If you’re not sure yet, or think it could be a mix, you can split your savings across a couple of currencies, or use a multi-currency platform that lets you stay flexible.

Some international savings plans let you hold investments in GBP, USD, EUR, and some niche currencies too. Also, offshore banks offer accounts where you can save in multiple currencies and switch between them if rates move in your favour.

If you’ve already been saving for years in the “wrong” currency, don’t panic. Start by reviewing your existing accounts. Work out where you’re likely to be when you actually need the money, then look to move your funds into the “right” currency. A financial advisor who understands currency exposure can help you get this right.

LET THE MARKETS DO SOME OF THE WORK
When saving for your child’s education, you don’t want every penny to come purely from savings. It’s better if some comes from growth, i.e. investing money and letting it compound over time.

For example, if you start investing money as soon as your child’s born, rather than keeping it in cash or a low-yield account, the growth over 15 to 18 years can be impressive. Even a modest return of 5% per year could mean a third of your final pot comes from growth, not your pocket.

The good thing is, as you’re investing for a long period, say 10, 15, or 18 years, you’ve got time to ride out market ups and downs. Historically, the longer you invest without withdrawing, the more likely you are to come out ahead.

You can also manage risk closely by choosing diversified funds, adjusting your investment mix as your child gets older, or using “target-date” strategies that gradually reduce risk over time.

It often helps to split education savings into different buckets:

• One part in cash or a low-risk account, for near-term needs or emergency access.
• Another part in investments, for long-term growth.
• Some bonds or structured products for a mix of safety and returns.

MAKE SAVING FEEL AUTOMATIC
If you want your education savings to run in the background, start by setting up an automatic transfer, such as a standing order or direct debit on the day after you’re paid. It’s the “pay yourself first” idea, where you save before you even feel like you’ve received the money.

If you’ve got other financial goals, like paying off debt or building an emergency fund, then think of your goals as buckets.

For most people, the top priority is filling your emergency fund bucket and aiming for 3 to 6 months of expenses. Once that’s full and high-interest debts like credit cards are under control, you can divert more money into education savings.

If possible, aim to save between 15 and 30% of your salary, which includes all your long-term saving goals, not just education. This could mean 10% for retirement, 10% for education, and 5 to 10% towards other future plans, for example.

INVOLVE YOUR KIDS AND TEACH THEM WHILE YOU SAVE
One of the best things you can do for the long-term success of your children is to instill financial literacy. It doesn’t need to be formal or serious. You can start small and age-appropriate.

For younger kids, it could be something like a clear jar or digital piggy bank where they can see savings grow. It builds a visual link between saving and reward.

As they get older, from 10 or 12 onwards, you can start sharing more details about why you’re saving and the strategies you’re using. For example, “We’re saving every month so you have choices later. School, university, or even starting a business.” That plants the idea that planning equals freedom.

For teenagers, it’s powerful to show them a simple savings statement. Let them see compound growth at work. Maybe even give them a say in how a small portion is invested, such as choosing between a few funds on a platform. It gives them a sense of ownership, and it’s a practical lesson in long-term thinking.

DON’T GET CAUGHT OUT BY HIDDEN COSTS OR TAXES
If you’re saving money for your child in a UK bank account, and the interest goes over £100 a year (and it’s money you gave them) then the taxman treats that interest as your income, not your child’s. A lot of parents don’t realise this.

If you’re abroad, it gets more complicated. For example, if you’re saving in an offshore account or investing in a fund based outside the UK, your host country might want to tax the returns. The UK tax office might also come knocking if you’re considered a UK tax resident or have UK-domiciled assets.

To avoid this, check if there’s a double taxation agreement in place. The UK has these with a lot of countries to make sure you don’t pay twice. It’s important that you declare things properly, fill out the right forms, and in some cases claim tax credits, as it isn’t automatic.

It’s a good idea to work with an advisor who understands both tax systems, UK and abroad, to make sure you don’t fall foul of any rules or end up being taxed twice. If you’re unsure whether you need a financial advisor, ask yourself the following questions.

• Where are your education savings held?
• In what currency?
• Are they in your name, your partner’s, or your child’s?
• Have you checked if they’re taxed locally? Or in the UK?
• Do they align with where you plan to spend the money?

If any of that is unclear, it’s worth chatting with a financial planner who understands expat finances.

BUILD A PLAN THAT WORKS FOR YOUR LIFE ABROAD
Once you know what you’re aiming for, it’s easier to figure out how much you’ll need. Then you can plan where to save it and which currency makes the most sense. A strategic approach with clear saving goals will stop you from over-saving for one stage and under-saving for another.

It’s a good idea to build a “portable plan”, which means using savings tools that work across borders and multiple currencies. Try not to lock yourself into a specific country or bank, if you can avoid it.

Many families default to saving money in their child’s name, but that can mean early access at age 18 or tax surprises. Sometimes, it’s better to keep savings accounts in the parent’s name or within a trust, especially if you want to maintain control.

Get in touch today to speak with an advisor who understands the unique needs of UK expats saving for their children’s future.