So, despite doing all revision on the bus and writing essays and facebook posts simultaneously, your child has passed their exams and is off to uni. How much will that cost you and what are their options? This is a very simple guide for people living in England.
Students need two lots of money: money for tuition fees and money to live on. They will want more than this, but we will concentrate on the basics here.
At the moment, tuition is about £9,000 per year. The student can borrow this from the student loan company. Living expenses depend on several factors. These include:
-if they will live in a student hall of residence or a flat,
-if the uni is somewhere expensive (London) or somewhere cheaper (Leeds),
-how much your student spends on clothes (boys: very little, girls: rather more)
-how much they drink (hmmmm, you are better off not knowing this one)
-whether they are likely to buy books (this idea is not intended as a joke)
-how much they will travel,
-how often they use the launderette (we live in hope)
However, having done a little research amongst very different students, if they study outside of London and spend very little during the holidays (ie live at home rent free, do not have expensive holidays or run a car) then it costs roughly another £9,000 per year. To cover these living costs, they can borrow another £4,400 from the student loan company. For parents on a low income, a further £3,400 maintenance grant can currently be applied for. This doesn’t have to be repaid, so some parents on higher incomes, not wanting their child to be at a disadvantage due to their own wealth, will give this £3,400 to the student.
This leaves a gap of roughly £1,200 for living costs. There are three options:
Option One: The parent gives no fixed amount but pays all extra costs as they arise.
Option Two: The parent pays a fixed amount. This encourages the student to learn to live on a budget, to be aware of costs and to make sensible decisions – all good life skills.
Option Three: The student gets a job and is self-sufficient. This will obviously impact both their study and social time. However, it also teaches them a bit about life in the real world.
Maybe a compromise would be to give them a reduced fixed amount, one with a shortfall, hence encouraging them to find work during the holidays but allowing them to get the most from uni during the term.
A final note on student loans. In 2012, the student loans changed. For students who began uni prior to that, the maximum loan was £20,000 with less than 1% interest. Then it changed and today the maximum amount is £40,000 (due to increased tuition fees) with 5% interest. This is a lot for a young person to repay. If someone in the family has savings, those savings are probably earning 1% interest. The student might therefore consider borrowing the money from a family member. They can pay back the loan with less interest than if they borrow from the student loan company.
Thank you for reading.
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