Surviving financially

[DaveTuckerforPM]

DD2 is just at the age where she is starting to think about university, so I’m trying to find out some info for her.

She would be entitled to maximum student loan, which would just about cover accommodation. As I am unable to work due to disability I won’t be in a position to help her much, if at all. I have seen on a couple of uni websites mentions of bursaries, scholarships etc - ranging between £2-4000 per annum if you are from a low income family.

Would that be enough to sustain someone living away at uni? We’re lucky here in that we do have 5 unis all within reasonable travelling time, but I don’t want DD to have to choose a local one so she can live at home and save money. Although obviously she’s welcome to!

I know there’s the probability of needing a part time job for her, but what if she can’t fond one for a little while?

@jessstan2

Stella in response to Xenia: You sound very bitter towards students from low income backgrounds. ....... I didn't get that from her post, I think she was just stating a fact. I have heard the same.

Mm

I really have heard others say the same with no hint of resentment, it's just a fact. I have no axe to grind, don't have youngsters at uni. I actually think it is quite good if people from poor backgrounds can live comfortably for a while at university and have no objection to my taxes contributing to that.

What year is your DD n @DaveTuckerforPM ? It is good that you have started to think about the cost of Uni already. Don't know what part time jobs are available during Covid but she could work work during the summer holidays etc and start saving now? Or else take a year out and work in that year so she has spare money for university if you feel she will struggle even with the maximum loan. If she is going to university she should go to the best university for her subject. This view may not be popular but she should also think about possible careers and see if her degree will facilitate it as well.

The salary discrepancies are crazy in UK IMO that as per Martin Lewis 87% of people don't pay their loan back yet for most careers, I think you need a degree. And degree apprenticeships are very competitive and placements are hard to come by in degrees with a year in industry. I personally think the whole system needs an overhaul.

• check for bursaries/grants etc - both at the University and your local council etc

• be flexible with accommodation - usually lots of variety so eg shared bathroom can be thousands less than fancy ensuite in a modern block.

• work out reasonable living expenses. Focus on term time, they can always work during holidays to build up extra if needed. Finger in the air for 36 weeks £2k should be enough (about £50pw). So as long as your accommodation is no more than around £7-8k you should be ok?

• save if you can - every little helps

I do and don't agree with the sentiment that those who get the full loan are better off. I don't think they are better off but I also don't think middle earners are worse off.

Each holds its own problems. Middle earning parents have to help a bit but definitely have more than those parents on benefits so it evens it out. And in the end the poorest still come out with more debts

We will have a hard time just having our DS home during holidays financially if he doesn't manage to get part time work.

Suppose what I am saying is that it isn't easy for any family at the moment, well unless you have a lot of money that is

agree. Means testing the parents, even though the loan is for the student, seems a little unfair.

The assumption is if you earn >X you can therfore afford to contribute Y is too simplistic too. It ignores your outgoings, it ignores if you have other children already at university (can be a big issue if you have a few children 2 years apart and 4 year degrees/gap years)

it puts an assumption in place but doesn't mandate any payments by the parents which can also therefore put students in potential financial hardship

No, I think you're right. I had a full loan back in the 80s, and was the only person I knew to have one, apart from a handful of well-off students from families with creative accountants. I shared a room with a girl whose parents were meant to contribute, but they had several daughters still at school and very limited cash left over after they'd all been housed and fed. She didn't get much help, and I felt a good deal better off than her. I don't think it crossed my mind that my parents would struggle financially to have me back in the holidays. I did buy the odd bit of shopping, but there's no doubt I ate more than I bought.
Middle income families will notice a drop in their normal expenditure once a teenager has left home, and the difference can be passed on to the student without feeling any financial pain at all. The same can't be said for people on benefits whose claim includes money for their child, when they lose that but still have to keep them for a substantial part of the year.

I can’t even really get het up if the kids who get max loan do end up with more money than those who don’t. My nephew gets max loan - yeah he might end up with more disposable income for the few years he’s at uni but due to my DSis not having much money he’s never been abroad, never had help with driving lessons or a car, never had massively fancy clothes or phones. In comparison my friends have DCs who get less loan and whilst my friends don’t necessarily have the money to top them up to the full loan, they do still pay for their phone bill, take them abroad on holiday, have helped them out with driving lessons. So I think it balances out really.

OP there will definitely be accommodation she can afford And as PPs said she can always work for extra money - even at the most competitive and academic unis first year normally offers enough time for a part time job. It’ll all be fine

It is not relevant to my children - the fact those on full loans tend to be quids in and the children of the middle class have less money. Mine have no student loans and £150 a week after rent is paid, rental income, shared car etc.

I just wanted to make the point more generally that the full loan is now like the days of the "full grant" - that the worse off get a lot more money than the middle class. In fact I heard a Labour politician who was instrumental in the first student loans on the radio the other month and he was saying it was one of their greatest achievements - that no matter how badly off the home is the large student maintenance loan for the not so well off is big enough to manage on.

I do find it weird that students don’t seem to work these days.

They do.
At least the vast majority of all the dozens upon dozens of students I have known over the last 6 or 7 years do - though it has been harder to find jobs this year of course.

How do you find out about bursaries for students from lower income families?

@vjg13 on most of the university individual sites they have student finance pages

In some cases it'll be automatic. Universities get the information direct from the relevant student finance organisation.

Thanks, it does seem to be be automatic at the universities my daughter has applied to using the student finance figures. One is £750 and the other is £500.

Back in the 80s neither I nor anyone I knew ever had a term time job, but I certainly got temp jobs in the holidays (Xmas, Easter and summer ) to boost funds.

I only ever knew one person with a term-time job back then. I remember thinking it was very strange, poor lad. It sounded like a fun job, though, and he wasn't complaining.

Government figures show that they expect 25% of student loans to be repaid.

The government need to ensure that the loans and other funding is available to those from a low income family where without the financial assistance the students wouldn’t be able to take up a Uni place.

Back in the 80s neither I nor anyone I knew ever had a term time job, but I certainly got temp jobs in the holidays (Xmas, Easter and summer ) to boost funds

I did. I had a few. Various babysitting jobs. I did bar work, and I had a sort of 'afterschool nanny' job twice a week for about 10 months. I think a smaller proportion of my peers did than student that I know do now though.

My kids are in year 4 and year 2 of university. They have the full loan. They manage easily and don't work in term time. They do a few weeks in the summer but not that much. It's fine. One is at Cambridge the other at Warwick.

The huge problem is that the type of work students did had dried up. Bar work, restaurant work, shop work and so much else has gone. You really cannot expect the number of part time jobs to fully come back for students.

There are anomalies in the system. Parents who didn’t marry but separate, with the resident parent on benefits ensure DC gets full loan I believe. The non resident parent could earn £100,000 but I think it’s not relevant on the application.

The parents who have more DC but are on incomes with no benefits are the ones who struggle more. It’s a case of trying to save beforehand. I think Martin Lewis has pointed out that paying the difference is down to parents but they often don’t realise it or do it. It’s not necessarily something he agrees with.

This is all fascinating reading thank you. DD has a couple of years yet before she applies, but we will look at the push site linked above (thanks @BackforGood)

FWIW DD fully expects to be in a position to pay the loan back, we're not looking for handouts. She has a career goal in mind which means she will be above the earning threshold. I just worried that it would be too expensive to get there.

Above the earning threshold nowhere near pays the loan back. You have to get your head around the fact it’s a grad tax. It’s not there to be paid back like a bank loan. Look at Money Saving Expert (Martin Lewis) for a good explanation. Lots of nurses and teachers will never pay it all back for example. Unless they become Head teachers! So it’s best to familiarise yourself with how it works. Basically grads pay it as a tax every month if employed. If she earns very highly, she will pay it back! But it’s absolutely not a requirement and 50% of grads don’t. She might even want to work part time in the future or take a career break. It’s all possible without paying a fixed amount each month. As a result, everyone can look at careers without worrying about repayments.

One fellow law student with whom I shared a flat in the 1980s worked at one of those girlie bars - she had to wear a very revealing uniform and had massive of make up on and her hair all kind of curled out.

Percy is right it is more a tax - you pay nothing back unless you earn over |£26k and then you only pay 9% of your earnings over the threshold. so if you earn say £30k a year for life you pay back something like £500 a year.

factor in 2.5-3k for living expenses for the year, leaves you with around 6.5-7k for accommodation which should be fine and if you're careful you may even be able to save a little to cover summer holidays and go towards year 2 where it'll be slightly more expensive private rental (as you rent for 12 months instead of the 10 for halls)

So I'd encourage holiday jobs, saving etc for now and looking at bursaries available to you. But not restricting your choices of where you're looking based on finance.

Ds2 gets a loan which covers his hall rent of £600 per mth (paid termly which is due a few days after he gets it), plus approx £50-£100 per mth left.

He also gets a small bursary as we don’t earn loads. But we still can manage to contribute every month.

I believe the loan assumes parental contribution, unless you have a low income which would mean loan of full amount.

Hall fees vary loads depending on whether they’re in a big city, red brick etc.

My advice is to try to pick a degree which leads to a career, as so many people do generic subjects which means they’re one of 1,000’s going for jobs.

It’s worth researching which jobs recruit in larger numbers and there is a demand for.

I do a job which doesn’t require a degree but there are loads of grads doing the jobs as it’s tough getting a job unless you’re a pharmacist etc.