Sending your child to private school has always been considered expensive. But, as Sarah Cole discovers, the true cost is even higher than many realise.

Forget the headline rate of inflation - if your children are at private school it is likely to be a lot higher. According to figures from the Independent Schools Council, school fees have risen by 40% over the past five years, and 6.2% in 2008 alone.

Day schools cost an average of £9,069 a year, while boarding school would set a family back an astonishing £22,059.

Richard Brighouse, a 46-year-old photographer from South London, has just finished putting his two children through Alleyn’s School. "The fees went up something like 8% every year. When we first got in touch with the school there was no mention of this, so we had no idea how out of hand the costs were going to get," he says.

Rachel Watkins, chairman of the Independent Association of Prep Schools, agrees: "Fees went up quite rapidly over the past 10 years, as schools updated facilities and ensured they recruited the best staff."

Fees and increases also vary between schools.

When faced with soaring costs, the canny consumer can usually vote with their feet, but as Richard says: "Once you are committed to a school, you can’t very well back out of it. Even before children get to serious exams, if they like the school and make friends there, it’s very hard to leave."

This would explain why Engage Mutual Assurance figures show that only 3% of parents plan to switch schools to cut costs as a result of the credit crunch, compared with almost 40% who will cut down on holidays.

Even if you decide to leave, the small print in many school contracts stipulate that parents must give one or even two terms’ notice. Most schools aim to give a term’s notice of fee increases so parents won’t be caught out, but others let parents know as late as the last day of term.

If you have a problem with increased fees, it’s worth approaching the school to find out what help it offers parents. Some 31% of pupils at independent schools receive financial help.

Watkins says: "If parents get into difficulties they should come to the school as early as possible, so they may be able to work something out such as deferring payments, paying monthly instead of per term, or holding fees at last year’s prices."

However, she points out: "If the child is very young and private school is stretching their finances too far, it may be sensible not to continue."

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Most schools offer scholarships, usually for gifted children, and these can pay a substantial portion of the annual fees. Many also have bursaries for parents in particular situations. Speak to your school to find out what it’s offering.

Watkins says some schools are reacting to the current economic climate by offering more bursaries, while others are offering fewer in order to keep fees as low as possible for everyone.

Richard’s experience of these options was less than positive. He says: "No-one was offered the chance to defer, and there was no question of a bursary for anyone other than women who had been abandoned by their husbands. We couldn’t complain about the fees because there are 80 applicants for each place at year seven, so there are always other parents in line who won’t complain."

Cap your liabilities

If you have yet to run into difficulties, you can cap your liabilities. Some schools have schemes where you pay upfront for at least three years and receive a discount. However, this relies on parents having a big lump sum in the early days, which isn’t always realistic.

Many parents also tap into the equity in their home to free up money for private education. This was the route Richard took, remortgaging twice during his children’s schooling. This is a reasonable approach if there is plenty of equity to take advantage of.

It could cause problems, however, if parents eat into too much equity at a time of falling house prices, as this could them into negative equity. It’s also important to consider the fees attached to remortgaging - you could end up with a worse deal.

Some parents are using loans to fund school fees. This may bridge a gap, but it’s worth considering how you will afford the university years if school fees have already left you in a financial hole. Parents may also want to ask their family for help. For example, grandparents may be able to contribute to school fees.

In an ideal world, parents will have a chance to plan before sending their children to school. Will Cairns, a 38-year-old business owner from Oxfordshire, sends his two daughters to St Hughes prep school, at a cost of just under £40,000 and puts money aside two years in advance.

"At the moment, I’m putting aside money for 2009 and 2010, so whatever happens in the economy, we will have available funds," he says.

Without the right preparation, parents may well struggle - particularly where the school is unsympathetic. As Richard says: "The school threatened to withhold my son’s A-level results until he’d paid a library fine. They may have charitable status, but they’re not very charitable."

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