Fees
The first question you may asking yourself as a parent is 'can I afford to send my child to university?' With fees seemingly rising year on year, you might be forgiven for thinking that it is completely out of your price range. However, this is not necessarily the case, if you don’t want to, or cannot, you do not have to contribute at all to the cost of your son or daughter’s higher education.
Student Loans
Students are eligible for a range of loans, designed to cover the cost of university and ensure that it is a viable option for people of all income brackets. They can take out a tuition loan, which is fixed and covers all tuition fees, however high they are. There is also a maintenance loan, which is designed to help with living expenses and varies in amount depending on where your son or daughter lives, where they study and what your family income is. In England, every student is eligible for a loan of at least £3,800, this figure increases to around £8,200 for those with a household income of less than £25,000.
Loan Repayment
As of this year, the government has scrapped their maintenance grant scheme, which used to give poorer students part of their loan as a grant that did not need to be paid back. This grant is now given as a bigger loan, however, you need not worry that your son or daughter will be drowning in debt by the time they leave university. University debt is more like a tax than anything else - students only have to start repaying it once they earn over £21,000 a year and it comes out of their paycheck automatically every month, just like tax. Furthermore, if they lose their job or their salary drops below £21,000, their repayments will stop automatically.
Even then, you need not worry that this is debt that will plague them for the rest of their lives. After 30 years, any remaining student loan debt is wiped off. This means that someone earning the UK average salary of £26,500 over their lifetime, whose debt originally amounted to the maximum £51,600, will only pay back £14,850 and have £36,750 wiped off. If you want an estimation of how much your son or daughter will pay back, the Complete University Guide provides a nifty student loan repayment calculator.
Furthermore, the interest rate for a student loan tends to be much cheaper than a regular bank loan. Throughout study and the repayment period, interest rates are at RPI (Retail Price Index) + 3%, unless the student in question is earning under £21,000. In this case the rate would be equal to RPI.
In addition to this, there are a number of university tuition fee schemes and financial support initiatives for students across the United Kingdom. For more information please click on the country you reside in (not the country you are attending university in!)
England
Student Finance England offers a number of loans and grants including:
- Tuition Fee Loan of up to £9,000, paid directly to the university.
- Maintenance Loan of up to £10,700 depending on circumstances, paid triannually into a designated bank account. For a breakdown of current allowances see the Student Finance website.
- Other Support- There is additional support available to disabled students, carers, care leavers, students with young children and those studying certain courses such as NHS degrees, social work or teaching.
- University Support- Many universities run scholarship and bursary schemes for exceptional students or those from poorer backgrounds. You can find details of this in the finance section in our UK Universities section.
You need to apply online for any government loans and grants by 12th June 2016.
Wales
Student Finance Wales offers a number of loans and grants including:
- Tuition Fee Loan of up to £3,810 to help towards tuition fees.
- Tuition Fee Grant of up to £5,190, which pays for the remainder of the tuition fee, that has not been covered by the loan. This does NOT need to be repaid.
- Maintenance Loan of up to £7,530, depending on circumstances. To find out how much your son or daughter may receive, see Student Finance Wales.
- Welsh Government Learning Grant/ Special Support Grant of up to £5,161, depending on household income and any special circumstances. This does NOT have to be repaid.
- Other Support- There is additional support available to disabled students, carers, care leavers, students with young children and those studying certain courses such as NHS degrees, social work or teaching.
- University Support- Many universities run scholarship and bursary schemes for exception students or those from poorer backgrounds. You can find details of this in the finance section in our UK Universities section.
You need to apply online for any government loans and grants by May 2016.
Northern Ireland
Student Finance Northern Ireland offers a number of loans and grants including:
- Tuition Fee Loan of up to £3,805 for those studying in Northern Ireland (NI university fees are £3,685 per year for local students) and up to £9,000 for those studying in the rest of the UK.
- Maintenance Loan of up to £6,780 per year, depending on circumstances. For a more detailed breakdown, see Student Finance Northern Ireland.
- Maintenance Grant/ Special Support Grant of up to £3,475 per year depending on household income and circumstances.
- Other Support- There is additional support available to disabled students, carers, care leavers, students with young children and those studying certain courses such as NHS degrees, social work or teaching.
- University Support- Many universities run scholarship and bursary schemes for exceptional students or those from poorer backgrounds. You can find details of these in the finance section in our UK Universities section.
Studying in the Republic of Ireland
Students from Northern Ireland, studying in the Republic of Ireland can get a repayable Student Contribution Loan to cover the cost of their contribution charge (€3000), which must be paid upfront. All other financial support, except the Tuition Fee Loan, remains the same.
Repaying your loan
In Northern Ireland students have to begin repaying once their annual salary exceeds £17,335. They are charged interest equal to RPI or the Bank of England Base+ 1%, whichever is lowest. The loan is then written off after 25 years as opposed to 30.
Scotland
Students studying in Scotland will have their fees paid automatically by the government, if they register with the Student Award Agency for Scotland.
Student Finance Scotland offers a number of additional loans and grants including:
- Tuition fee loan of up to £9,000 for scottish students studying in England, Wales or Northern Ireland.
- Young Students’ Bursary of £1,875 a year, for students whose household income is less than £17,000 per annum. This does NOT have to be repaid.
- Student Loan of up to £6,750 a year, depending on household income.
- Independent Students’ Bursary of up to £875 a year for ‘independent’ students with a household income of less than £17,000 per year.
- Other Support- There is additional support available to disabled students, carers, care leavers, students with young children or those with a dependant.
- University Support- Many universities run scholarship and bursary schemes for exceptional students or those from poorer backgrounds. You can find details of this in the finance section in our UK Universities section.
Repaying your loan
In Scotland students have to begin repaying their loans once their annual salary exceeds £16,910. They are charged interest equal to RPI or the Bank of England Base+ 1%, whichever is lowest. Then the loan is written off after 35 years.
Costs
The living costs associated with attending university can vary depending on which region your son or daughter studies in; whether they live at home, in university halls or private rented accommodation; and how much money they are used to spending on a weekly basis. The charity Brightside offers a student calculator, which can help you and your son/ daughter determine how much money they will need each year.
Based on our average annual spending chart, which includes the cost of utilities, food, leisure and personal items, students are likely to spend around £6,250 a year on these items. Rent varies hugely around the country but a reasonable price for a student house in most areas is around £90 a week per person. This amounts to £4,290 for a year contract. Therefore an average student may spend just over £10,500 a year. This leaves a shortfall of nearly £7,000 for those with the lowest maintenance grants but it must be noted that these figures are bolstered considerably by prices in London, which are far higher than anywhere else.
If your son or daughter is facing a shortfall in funds of around £7,000 a year or £580 a month, they have a few different options. Firstly, as I said the above figures are generous estimates. By choosing to live close to university, they might eliminate travel costs; their course costs may be far lower than the average, if they study something like history as opposed to something like art; and by shopping around for utilities and food, they will shave a huge chunk off their monthly expenditure.
Saving money is not the only solution, as a parent you may chose to cover the cost of one of their expenses, such as rent. Equally they could look for a job. To make up the above shortfall they would need to earn £130 a week, which is equal to 19 hours at minimum wage. This would be hard work but it is doable especially since there are so many companies out there whose hours and rotas are designed to fit in with student schedules. Also bear in mind that students have nearly three months every summer, and this is a perfect opportunity for them to save up for the year ahead.
