Brits are cash-strapped but still saving £14.5bn a year

According to Robin Stoakley, managing director of Schroders' UK intermediary business, research demonstrates 21 per cent of Britons are saving for the purpose of providing the best education possible.

The average saver is putting aside about £122.57 a month for this, despite the fact that UK consumers are still cash-strapped and incomes are squeezed.

Mr Stoakley said 43 per cent of Britons were saving for university; this was the main focus following media reports about the £9,000 a year tuition fees facing students in the future. 17 per cent were saving to pay for college or vocational education for their children, 6 per cent were saving to pay fees for private education and 4 per cent were saving for extra tuition.

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In a Schroders' study among IFAs, 47 per cent said they were advising clients on ways to save money to cover education costs. The most popular ways to save were equity Isas and Cash Isas.

Mr Stoakley added: "Due to the increase in school fees, university tuition fees and the increasing pressure on children to attain high grades to secure the best university and college places, it is unsurprising that so many people are now saving for their children's education.

"While British families desire to provide the best education for children has to be commended, parents and grandparents also need to ensure they make suitable arrangements to provide a nest egg and income for themselves, particularly in terms of building a retirement income. An IFA is best placed to provide this."