Student finance: What you need to know
Planning to go on to higher education but unsure on the costs and how you can afford them? Student finance offers tuition fee loans, student grants and bursaries, all designed to provide support with the costs of being a higher education student. Continue reading this article for advice on the financial options available to students and how to manage these finances better.
How Much Does University Cost?
The maximum amount of tuition fees that publicly-funded universities and colleges can charge students annually, is £9,000.
Every university or H.E college will charge a tuition fee for each academic year you study there.
The amount they can charge you as a student, depends on where you currently live and would like to study.
The maximum amount of tuition fees that publicly-funded universities and colleges can charge students annually.
Average costs for higher education courses within the UK in 2016/17, are shown below:
|Student home region||Location of university or college|
|England||Up to £9,250||Up to £9,250||Up to £9,250||Up to £9,250|
|Scotland||Up to £9,250||No fee||Up to £9,250||Up to £9,250|
|Wales||Up to £9,250||Up to £9,250||Up to £4,046||Up to £9,000|
|Northern Ireland||Up to £9,250||Up to £9,250||Up to £9,250||Up to £3,925|
|EU||Up to £9,250||No fee||Up to £4,064||Up to £3,925|
(Source: UCAS, 2016)
You might be eligible to apply for a tuition fee loan, covering the full cost of your course up to £9,000 for each year of your studies.
Student finance pays the tuition fees directly to your university or college and you only start repaying once you’ve completed your studies and started earning above a certain amount.
If you’ve received funding for previous undergraduate study, plan to be a part-time or postgraduate student, or wish to study in a privately-funded university, you should contact the student loans company, as different funding rules apply.
If you plan to study a master’s degree, you can apply for a post-graduate loan if your course started on or after the 1 August, 2016.
You might be eligible to receive up to £10,000 towards your course and living costs.
You might be able to receive a tuition fee loan, if your course has a ‘course intensity’ of 25% or more.
The level of course intensity, depends on how much of your course you complete each year compared to an equivalent full-time course.
If eligible, part-time students can now apply for:
- A tuition fee loan of up to £6,750 per year
- Disabled Student’s Allowances
Students from Wales can apply for a tuition fee grant of up to £5,100 and a tuition fee loan of up to £3,900 in 2016/17 to pay for their course in a publically-funded university or college anywhere in the UK.
You’d only repay the loan element of the tuition fee once you’re earning enough after you graduate.
(Source: Student Finance Wales, June 2016)
Maintenance grants and loans for living costs
In England, student maintenance grants are no longer available for new students starting in the 2016/17 academic year and will be replaced by a loan system. These will need to be repaid once you’re earning more than £21,000 a year, before tax.
In addition to tuition fees, there are a number of other living costs you’ll need to pay for while you’re a student.
Including costs for:
- Books and study materials
Maintenance grants and loans are available for each year of your studies to help with these costs.
The maximum amount you can claim or borrow depends mainly on:
- Which UK country you’re from
- Your household income (for grants)
- Where you’ll be living during your studies
You receive a payment at the start of each term (monthly in Scotland) into your student account.
In Scotland, maintenance grants are known as bursaries and in Wales, they are known as Assembly Learning Grants.
New maintenance loans for part-time students in England will be introduced from 2018-19, to support the cost of living while studying.
Choosing between student grants and loans
Work out how much maintenance grants and bursaries could offset your need for maintenance loans or overdrafts.
While any maintenance grant you receive reduces the amount of the loan you might be eligible for, you don’t have to repay any grants given to you.
If you need to take out a maintenance loan, it’ll generally be more cost-effective than taking out a commercial loan and certainly cheaper than funding your living costs as a student on credit cards if you can’t make regular repayments.
Similar to tuition fee loans, you only pay back maintenance loans in instalments once you’ve graduated and started earning over a certain amount.
Financial support available to students of student financial help
There are a number of other financial support packages such as bursaries which you might be able to access as an undergraduate instead of loans depending on your circumstances.
These include support for:
- Disabled students
- Students from low-income households
- Students with children or adult dependents
- Those studying for particular professions (E.g Nursing)
Student money advice - Managing your budget
Now that you understand the difference between a student loan, maintenance grant and bursary, it’s important that you plan how to use each effectively to help with the the day-to day costs of being a student.
Remember: Nothing you borrow to fund your student life is free money!
Don’t earn enough? You won’t have to repay yet
Student loan repayments are calculated based on how much you earn.
For courses funded by student finance in England or Wales from September 2012, you’ll only have to start making repayments from 2017 once you begin earning £21,000+ a year.
In Northern Ireland and Scotland, loan repayments only start once you’re earning over £17,495 a year.
Your employer will automatically deduct these payments from your salary.
If you’re self-employed, you’ll make repayments through your self-assessment tax returns.
You pay interest on all tuition fee and maintenance loans from the moment you receive them as a student, until the balance is repaid in full.
If you haven’t repaid the loan in full, 30 years after your first payment, the remaining balance is written off.
Students often forget that they have to pay back their maintenance loans as well as tuition fee loans, once they’ve begun earning a certain amount.
This can come as a shock once you see the first monthly deduction, so be prepared.
Student finance advice - where to go?
Student finance can often be a tricky subject to digest at first.
So, here’s a brief summary of the most important information to know remember:
- The Maximum tuition fee amount that universities can charge, is £9,000
- After 30 years, any outstanding debt left to repay is automatically written off
- The average UK University graduate will leave with an estimated debt of £48,000
- Full-time students starting from 2016, can apply for a maintenance loan up to £8,200 depending on household income
- Interest is charged at the rate of inflation, +3% pa while you’re at university. It continues at 0-3% thereafter
- Maintenance grants are still available for current students that started their course before 2016
- Other grants and funding are available for new students with disabilities, dependents or those that come from low-income backgrounds
- There are major differences between systems in England, Wales, Scotland and N.Ireland
For more information on grants, loans and other financial support available for undergraduate, part-time or postgraduate students, speak to a careers adviser at your university or college.
Alternatively, contact your country’s student finance agency (or the country where you plan to study if you’re not a UK resident:
- Students in England – go to the Student Finance England on the GOV.UK website
- Students in Scotland – go to the Student Awards Agency For Scotland website
- Students in Wales – go to the Student Finance Wales website
- Student in Northern Ireland – go to the Student Finance NI website