The state and conditions of financing investment in higher education have been analyzed. The feasibility of developing the future model of financing of investment in higher education as a set of modern forms, tools, mechanisms and approaches of the investment process has been specified. Perspective tasks of financing investment in higher education have been determined. Areas to improve the mechanism of budget financing of investment in higher education have been specified. Purpose of the article is to develop proposals to improve the mechanism for financing investment in higher education. Future challenges of state funding support investment in higher education have been highlighted: improving the tools of state regulation of investment in higher education; conceptual justification of provisions to the policy of the state (budget) funding of educational investments; implementation of effective models of public-private partnership in financing investment institutions of higher education; stimulation of the modernization of technical and technological base of higher education, enhancing its intellectual and material support, support for full participation in the programs of international education cooperation. The long-term financial model to ensure investment in higher education should include: definition of public financing and investment of higher education as a priority direction of budget expenditure, ensuring strict implementation of government decisions on investment of higher education; forming investment support multichannel system of higher education, including the use of new tools (educational vouchers, education loans, etc.); full state funding for higher education in state and communal educational establishments in the extent of state standards; encourage investment businesses and individuals to the development of higher education, including using tax instruments; identify priority areas of higher education investment and concentration of financial resources for their implementation; ensuring effective use of funds for the operation and development of higher education, including the use of mechanisms of public control. Measures should be taken to improve the mechanism for determining investment expenditures in higher education, primarily through the optimization criteria (indicators) for the valuation of these expenditures. It is advisable to strengthen joint state and public control over the formation and execution of budgets of universities in the Ukrainian conditions. In future studies should be performed to determine the social and economic performance criteria for non-investment in higher education.