Student Finance - think this through with me..

[FenulaFriday]

DC is very fortunate to have been offered a scholarship for their living costs for the first year, for £13,000, so obviously doesn't need the maintenance loan this year.

If £13,000 is the expected living costs, we're going to struggle to top them up to that level the following years, we were thinking it would be just to the ~£10k that student finance suggests.

So.. is it worth still taking the minimum maintenance loan this year and banking it, and see how spending goes - and then either use it next year if needed, or part of it, or if it's not needed, then not take the maintenance loan next year?

DC is very sensible and would put it away, to be honest I can't see them spending the £13k but clearly Uni may know things I don't! The scholarship is a once only thing, it's not going to happen in years 2/3.

Is there something I've not thought of? Obviously it would be more to pay back, but the monthly amounts would be the same.

Thanks

I think that your plan to take it and see how it goes is a good one, as like you say DC can just not take next year's so would work out the same. Would DC get full loan based on household income?
Also, unless their course is very heavy, a part time job is easily fitted in and would only need to do 10 hours a week at most to get another few grand. Plus working summer holidays for a few £k more.

In Scotland you have until the March of the next year to decide whether to take or not so perhaps your DD could see how it goes. Interest accrues as soon as you get the money and I doubt you could get that rate on short term deposit.

That seems like a solid plan. If they don't need it next year - great, they can use the money from this year. If they do need it next year - phew, you've got access to it.

I guess one question to consider (for all of us really) is what the maintenance loan or scholarship should cover, and what you might continue to pay for yourself. I'm expecting to pay ds' mobile phone bill for example, as I have one contract with all our phones on. I would pay for any equipment that he needs (as his course will involve a fair bit of field work) and I will no doubt pay for things like haircuts if he's canny and waits til he's home. The scholarship seems quite generous and I wonder if it's meant to ensure that all non-tuition costs are covered?

I think that some places outside of London are very expensive to live in, Bristol springs to mind, I don't have a child there but am sure that it is expensive reading the threads on here. On the basis that some places cost more I think your advice is good, take it out, bank it and see if they need to take out any finance in year 2. Remember in year 3 they get less despite still forking out for accommodation as no summer cover needed according to the government.

For what it is worth, £13k seems like a lot considering the maximum loan is under £10k, it might be a very sweet deal to entice someone to take the scholarship and well done to your DC.

I would definitely do as you suggested, rent can be very expensive.

Thank you all. Yes as SandyIrvin says the interest would start to accrue immediately rather than later, but I think it's worth it to know the money is there.

Yes, as next year living costs will be even more expensive and rents are only going to get more expensive, my friends son pays £12k for rent.

Yes, I'd definitely suggest taking the loan and putting it in whichever bank account currently pays the most interest (I think Natwest's student account might even pay 5% on positive balances..? Check on MSE for highest interest accounts, think there's some new ones on the market).

Then even if you pay it all back again at the end of Year 1/2/3, you've made the interest, which you can keep.

I would take the maintenance loan so DD had access to the full amount but would consider making any contributions I would have made directly to DD to the loans company instead to start paying that off for her. You might not be able to pay off the full amount but you could pay off a fair whack. Or if there was a bank account with a higher interest rate like first directs regular saver at 7% put it in there for a year and then transfer it over.