The wealth and asset management group revealed in a report that parents are increasingly funding private education at the expense of their own long-term financial security, creating a growing ‘double squeeze’ between supporting their children’s education and protecting their future finances.

It found that more than one in five (22%) said they deprioritised ISAs and long-term investments in order to afford education costs, while 20% reduced pension saving. More than a third (36%) cut back on holidays and leisure spending and 29% postponed home improvements.

Nearly one in four (24%) families said they absorbed the higher costs but with financial strain, while 16% delayed enrolling a child in private school and one in ten (10%) moved, or plan to move, a child out of private education altogether.

Rathbones’ report suggested that education is increasingly becoming one of the UK’s defining intergenerational financial planning challenges, as parents and grandparents take on a greater share of education funding.

It also revealed that nearly seven in ten (69%) parents who currently contribute, or expect to contribute towards university costs, expect to fund at least half of the costs and that more than a quarter (26%) expect to contribute more than £50,000 per child towards university costs, while 11% expect to contribute more than £100,000.

The report also revealed that almost half (46%) said education costs are likely to affect their retirement planning and nearly two-thirds (65%) said grandparents contribute, or are expected to contribute, towards education costs.

More than two-thirds (67%) said upcoming inheritance tax changes affecting pensions increase their desire to fund education during their lifetime and more than eight in ten (81%) believe rising education costs are making life chances increasingly dependent on family wealth.

Amanda Cook, financial planning director at Rathbones, said: “As families prepare for a new school year, many are finding that the true cost of private education extends far beyond the school fees themselves. The pressure is forcing households to make difficult trade-offs, with some reducing pension contributions, scaling back investment plans and dipping into savings to fund educational opportunities.”