Saving for university ?

[HoopyFroodDude]

Are you saving for your children to go to university ? If so do you mind me asking how much?

I have not planned for this but have been inspired by another thread about university debt to start. Do you have any tips ?

There is this strange consensus here that all living costs accumulate as debt on top of the loans and you have to go to Uni straight from school. Most universities are 30 weeks of the year, during which you can work part time, working full time for the rest. This covers living expenses (albeit not luxuriously). The odd exception of courses that are more intense also have much more financial help and feed into jobs that are much better paid.

There is also nothing wrong with a gap year, not in the sense of travelling the world, but working and saving. DH did this and started Uni with £20k saved from one year, a scholarship from the company for his fees and a full time summer job (adding £8k each summer). I prefer teaching those who have worked between school and university, they have a better grasp of where uni fits in the grand scheme and work harder.

I would definitely encourage getting the student loans at the rate of inflation instead of using up savings (especially from ISAs paying good interest) to pay them off as well.

To those of you who think your kids will be rich enough to pay their student debts and keep you in a good lifestyle too if they study law or medicine, you should think again! With the public sector spending cuts, there is going to be less money in the NHS and, unless you are a corporate solicitor, I doubt that there is going to be much money in law either... Now Engineering with Mandarin Chinese on the other hand... I don't think there is any harm in letting them live on a bit of a shoestring, but if they don't qualify for the full loan then the parents should maybe top it up (perhaps as a loan?) - it's not the kids' fault their parents earn "too much". I would have thought (not checked though) the full loan is barely subsistence level anyway and they are most probably still going to have to do a bit of paid work, but I would not want them to spend all our / student loan money on an education then jeopardise it by working very long hours. I was very lucky and went to uni during the days of the almost full grant and managed to top up my money with a small part-time job. But I think anything more than 10 hours a week could well interfere with your studies and may not be possible depending upon the kind of course (say, nursing, biochemistry or medicine, as already mentioned). Also, some students (say, law or politics) may need time to do internships, voluntary work or get involved in societies, which is all part of the university experience, helping them to develop social awareness and leadership skills. Let's not forget that some unpaid work experience is almost a prerequisite for some careers these days.

Tatty - Ahh I am working as a nanny right now. I have degrees in Law, history and politcs. I earn jack all but I still manage to pay my debts off.

DD knows how hard it will be, that's if she is lucky enough to get into medicine. She is aware that it will be hard to do part-time work and study the course. 10 hours a week would be better than nothing, knowing DD it would cover her food/drink etc. She is also hoping to work in a caring role in the holidays. She isn't going into medicine for the money but because she wants a worthwhile career.

In a way I hope she changes her mind.

DD1 in second year.
We pay her accomodation costsof £3,500 or so a year.She has the basic maintenance loan of around £3000 and the tuition fees loan.
She works part time.
DS,now 14,wants to be a doctor like DH but he will also borrow whatever is available then,with us paying accomodation,or if I can get him to stay home,other expenses.
We also have 2 other DDs so even though we are on above averge income we couldn't fund £50k of debt for them all.{grin]

I agree it is wrong that in every other respect they are considered an adult,but still 'dependant' when it comes to fees.
And yes,too many people go to university.

Mamatomy - I thought you had to be 16 to get an ISA?

We are saving for DS, either for Uni or as help with a deposit on a house etc. It definitely won't be used to fund a gallivanting year ooff or such like!!!

All these people happily saying their kids will 'get a part time job' - unless things improve a lot by the time your children go to university, you (and they) may be in for a nasty shock - it's really not going to be that easy. There are simply not enough part time jobs to go round in most university towns, or when they come back home for the summer - lots of them are still filled by recent graduates who haven't been able to find anything else.

DD has just got a job in telesales for the summer, where she was one of five hired out of 12 interviewed - and 160 who applied. If she doesn't make her target she will be out - and not that many people are buying right now....

Am already planning for my children to live at home and study through the OU if they really want a degree, or to go to Holland and study for free as they speak Dutch. If the EU still exists then.
It doesn't matter how many are saving for their chidlren's education, to many people won't be able to pay it, so if there is no grant system to help, more and more have-nots will be excluded from higher education.

We can't save for ever more stratospherically expensive houses, ever more underfunded retirements, and ever hire uni fees because there's only so much money out there. I'm a single mother so no chance.

It's all very well saying that there are too many students, but if the Government makes the DC's choice of career graduate-only then what else can you do?

Rusty is right about the part time jobs. They are hard to come by especially or 1st year students.....lots of the good ones are already taken by 2nd years.

DD worked for a supermarket, and managed to secure a term time job before she went away. She then did the same job back home in the hols. In her final year she couldn't work because of placements.

DS couldn't work in term time because he had over 30 hours per week of lectures or tutorials plus extra work in the evenings. Lots of science/engineering couses have longer hours of time tabled study not just medicine. He also carried on with his sport at weekends.

We save £150 a month for each DS, which hopefully will amount to £30K each when they reach 18.

If they choose to go to uni we will pay accomodation charges and they will have to pay for tution fees and living costs out of this and top up with a part time job. hopefully that way they can minmise their chances of starting work with debts

We were going to use a redundant mortgage endowment for DD as it was due to mature in 2018 just as she would be going, but we ended up cashing it in last year for the deposit on our new house. Now have 8 years left to repair the damage...

To those who are saving - and I see some are putting away quite a bit each month - are you putting it in cash deposits and 'low risk' (except from inflation) stuff, or are you taking some risk (like by investing in shares) in the hope of better returns?

Yep- started before DS was born. My and my DH's ISAs are earmarked for DS's school/university fees or first house deposit, depend on when he will need the money.

LadyWellian - I'm investing in shares whilst DS is young, as over 18 years it's likely that returns will outstrip any interest rates. However I shall rethink this as they get nearer 18 and potentially move out of shares to lower-risk investments.

DS1 wil be going to Uni this Sept. Just started saving up and plan to have the 3-3.5k of living expenses covered (since only qualify for the minimum loan). That will be for 3 years, then we have 3 more possibly to follow but none wil be at uni at same time. Need to keep it fair and cover living cost amount and hope that we still have jobs / enough savings to cover the next 16 years or so!!! Just saving in a high a rate deposit place as we can ISA limits have gone up quite a bit this year.

We live near three universities - if my children do want to go to college, and the course they wish to do is available here, they can stay at home and we'll keep them under our roof and feed them. I lived with my mum for a year when I came back from Uni and wanted to study for an extra year; we drew up ground rules and it worked okay.

If they want to have the whole student experience in a shared house etc then they're on their own. I got a full grant, and I had a lot of fun, but a lot of it went on rent. I think the days where people can go off and live wherever they like should be over - living in a shared house which smells of damp isn't an essential element to 'growing up' imo.

We are not saving. I am SAHM with 2.4yo and pregnant with second and we have no extra money in our budget for savings of any kind. Hopefully this will change when DCs at school and I may work then, or if DH promoted, but I imagine we will use the extra money to provide experiences for our children now, such as being able to go on all the school trips, have trips away learning to do new things as a family etc.

I was from very low income family and funded my own university place by loans (now paid off from good job post-graduation) and I lived at home so no living costs. I expect my children to make an informed decision, which of course I will help them to make, about whether the cost/benefit of going to uni is worth it for them. FWIW DH did not go to uni, and now has very senior career in accountancy, so he is a good example to DC's that you do not need uni to get on in life with the right attitude.

We were talking about this last night for DS - who is 6 months old! the thing is, i can see when he gets to uni age you'll have to pay the lot yourself (I think it's about £10k the government pays per student each year on top of fees the students pay). We just thought if we start now, it's not going to be as much to find each month to get a good pot, and if he doesn't got to uni we can go on a round the world cruise help him with first house deposit.

I left uni with no debt, DH left with very little and we've watched friends who started work £20k+ in debt having a "what's another 2 grand?" attitude and maxing their credit cards and overdrafts. They seem to just get used to being massively indebted with years of paying it off before starting saving.

I don't want DS to think like that.

My DD is 18 this year and a UCAS rep came to the school last week to talk to all the girls hoping to go to Uni in 2011.It seems that every student is more or less expected to take out a student loan for tuition fees ( currently aroud £3,250 a year)so a three year course would mean nearly £10,000 worth of debt which they then have to pay back once in full-time work and earning over £15,000.This is very much against the grain for our family as we have tried to bring the children up to pay for things when you can afford them and not to get into debt......the UCAS rep was very worried however that the govt could raise the fees after 2011 and this would put a lot of kids off going to Uni even tho they have the academic ability, because many would not want to start their working life upwards of £20,000 in debt.

We're saving for a fund for the kids. It is not in their name and they will have no access to it. It's there so that we can helping hand if it's needed and if we deem it necessary.

Sorry forgot to add the target sum was set at £30k in 2003, that amount will rise with the RPI.

Can i ask those who save: have you told your dcs that you are saving for their uni years? And if you have what did they say? (did they wash your car?)

Well DD is 8, my Dad is 85, so it stands to reason that I may be in a position to help her out by the time she goes.

I may or may not, but either way, she has a trust fund from my Dad which will pay off any debt when she finishes if that's what she chooses to do with it.

I may not tell her that exists though, depending how sensible she is as she gets older.

If I was saving....I would be tempted to keep quiet about it for as long as possible!

Teenagers and large amounts of unearned money = problems!

Mine wash the car for enough to buy fish and chips on the way home from cricket!