How much for parents to save for university?

[Deeprug]

Just starting to get my head into this. Two dc at secondary close in age and potentially would be at uni at the same time. We have an average income; how much would you try and save for each child to try and take the pressure off us when we get to that point? What would be a good amount? We are not rich, so it would have to be for a basic level iykwim. Is it £5K per child, per year? £10K??

People also hear about student loans so they assume that these will cover their child's maintenance. Whereas for an increasing number of universities, even the maximum loan is barely covering the rent.

I think its only then that childcare costs reduce that you have a bit spare.

But for me, I hadn't appreciated how the maintenance loan hadn't really kept up with inflation, or with the cost of student accommodation in particular. Lots of private equity in student accommodation now and the costs surged.

Also remember more that half of students dont go to university aged 18. Savings can always be used for other things, but I didnt go, so it wasnt massively on my radar. Lots take a gap year to earn and lots never go.

Hi OP if your HH income before tax is more than about £60k (if you both work FT it probably is) then DC will qualify for the min loan. This is about £5k this year. You are then expected to top this up to about £10k a year.

So your DC will need to cover

• accommodation costs
• Bills if applicable (not in halls)
• Food
• Clubs, gym, social activities
• Travel if needed

The biggest is obvs rent and then food. Food IME can vary – DD spent about £25 a week but she is veggie and doesn;t eat much. DS2 is a meat-eating weight trainer so he spends closer to £50 pw (also supermarket prices haev gone up in that time tbf).

Accommodation - I do bang on about this here but I think it's important to consider this. Some unis have very ££ accomm; some cities have ££££ private houses. So do have a look.

Unis I have recently checked out as having cheaper (by which I mean £4k-£6k py) halls available (not a complete list haha) - Leicester, Sheffield, Newcastle, Loughborough, Warwick.
Nottingham on-campus halls are all catering; Bristol anecdotally is expensive for private houses (I know two people who are paying £10k a year for their DC); St Andrews is also ££; London obvs also ££ (you get a higher loan).

Cambs and Oxford are cheaper as they have low-cost college accom.

As you can see, the £10k (loan plus your top-up) may not be enough - depending on where the DC go.

I see others have made some of the same points haha :)

It's good that you are thinking about it; a colleague spoke about their DC looking at a uni where the "cheapest" (not sure if that's true tbh) accomm was £250 pw (!!) and they said "oh well, DC will get a loan to cover it all" errm no I doubt it. £250 pw even for 40 weeks (usual halls contract) is £10k.

ETA: my figures are obvs all based on this year! By the time your DC go @Deeprug things will have gone up still more – tho I suspect a) the income threshold and b) the min loan will not have risen as much as food and accommodation costs. Sadly.

I’ve worked on the basis that my DC needs £12.25k - that’s the full maintenance loan adapted for inflation (which it hasn’t kept up with)

I agree that them working in 6th form and summer before uni is good to build savings.
For any families struggling to top up to £12.25k, it’d suggest a year out and working full time. What they can save in a year can make a huge difference.

It also helps if you set a budget before they look at uni accom. That way, they know that if they select the expensive accom, there will be less available for other things.

I'm hoping to get my hands on 30K and I guess will just keep topping that up. If they end up not going i will pay it off the mortgage. Thanks everyone, I just wanted to know where I need to be.

Those figures, or equivalent future purchasing power, is a good start, assuming they ll get some student loan maintenance and uni fees paid.
They ll need the higher figure if studying in London.

We’re at this stage - eldest will hopefully go next September all being well. I’m hoping she’ll get a job part time to help but initially expecting to top up £800 ish a month. We haven’t got savings specifically for this but should be able to absorb the cost each month for 3 years (one year will be in industry so she’ll get paid for one of the four years).

twins are currently looking at non uni routes. Dd1 needs uni for her chosen career but I am now off the opinion that apprenticeships are worth considering depending on aspirations and a standard 3-4 years at uni is often not the best option. Dh has a ba and I’m qualified to masters level.

We are accepting we may have a tight 5 years with finances but, like nursery, it’s only a brief phase in the scheme of things. Once they are done with uni, focus will move to paying off mortgage.

I gave nothing like £10kpy. I topped up from min maintenance loan to maximum, anything above that was earned by DC and they chose cheap accommodation and lived frugally. I think I started saving £75pm into a S&S ISA in mid primary school, it more than covered. Don’t forget you don’t need to have it all upfront either, you can contribute from income earned over the 3/4 year period too.

it is unfortunate that there is hardly any allowance for having 2 children in univeristy at the same time - we will have at least 1 child in uni for the next 7 years with an overlap of 3 years. DS1 has just started a 4 year course and DD will go next Sep. When they both finish DS2 will be starting.

We are lucky that we live in Wales so everybody gets a total of £12k - everyone gets 1k grant and the rest is made up of either loan or grant depending on income. so DS gets the minimum which means 1k grant and 11k loan. if you were say on benefits then you would get 12k grant.

That is oneof the things that is wrong with the system. What is do-able for one child at a time for many families is totally unaffordable for two.

One conversation to have with DC as they move into the GCSE years is that if they intend to go to uni the accomodation at different unis varies in terms of cost. So a DC wanting to go to UCL is going to cost more in rent each year than the maximum loan. A DC somewhere cheaper will be able to cover their rent with the maximum loan. Maybe suggest that they might need to think about a gap year to earn some money especially if they want London (although unis don't like those for maths heavy courses).

Actually it’s much earlier than that: I went to university in the 1980s and parents were expected to fund the difference between your grant and actual living expenses. I had a full grant, but dh got nothing and his parents paid all his accommodation and expenses.
of course in the 1980s a full grant could cover all your expenses. My grant cheque per term was £700 and my catered accommodation was £350.

Need to be overpaying mortgage, overpaying into pension, saving for university,

Prioritise.
Extend mortgage so monthly cost lower and don't overpay right now til uni over
Each child circa 500 or 600 a month
7k a year not 10k each

Talk about it early and set some parameters.

1. oxbridge is cheap compared to others, because they only charge accommodation for term times, and they give a sliding scale bursary to every student from a household with income under about £65k. If it’s an option, it’s definitely worth a punt.
2. london really does cost a lot
3. look at accommodation costs when choosing uni
4. take a gap year and use it to work: tbh they could earn not far off the whole amount they need for 3 years
5. applications for paid summer bursaries start the previous November, can pay quite a lot and are the most helpful for post graduate employment too. Ds just got a job offer from his final internship.

We're on our 3rd going to Uni.
This time round we're paying DD's rent and she can live off the maintenance loan.
Costs vary wildly on accommodation. We're paying about 8k this year, it might be a bit less for years 2&3 but one of her friends (elsewhere) is paying an eye watering amount -13k a year. If your DC are dead set on somewhere expensive you might need to think about gap years for jobs etc. Look at accommodation costs alongside course information.

Blimey @Beamur where is the £13k? I hope it is fully catered with an onsite gym to use for free 😀

Bristol. Plus pool and cinema room. Really not her first choice but all that was offered. That or nothing. Not first choice Uni, so insurance choice and limited accomodation available.

Self catered...

Martin Lewis goes off on one about the lack of publicity around the ‘parental top up’. It’s rarely mentioned that there is a funding gap that parents must fill. So not surprising many people assume that the loans will cover everything.

I’m expecting to pay £7000 a year to top up for two and one of them will probably do a year abroad so it’ll be £49000. We’re also avoiding places with expensive accommodation. Some universities are now the preserve of young people from wealthy families…

Out of interest I looked at Bristol uni accommodation (my alma mater) and the only undergraduate accommodation I can see that costs £13k is a studio in Churchill hall (where I was in my first year! not sure I would have paid that much hahaha) but that's catered.

So I assume it is non-uni accomm. What a rip-off. It is worth being aware than non-uni accommodation can be more £££ (not always tho – IIRC a poster with a DC at Nottingham was very happy with their non-uni student hall).

Yep. Private halls.
Definitely something to consider if you are looking at clearing or insurance offers. You may be guaranteed accomodation but it could be private sector.

Some London uni’s like Imperial give a £5K bursary each year for those eligible for the max loan which can be spent on whatever the student wants. They also have have ‘cheap’ accommodation at North Acton, only a few stops from Hyde Park. Small double beds, all en-suite rooms at £6.8K. Sociable halls too.

This. My parents paid my rent and gave me money for food and basics in the late 1980s. I am very grateful as I just missed a grant as their income exactly hit the cut off point. I had a job every holiday to top this up and have some fun spends. We have saved for DDs for uni costs since they were born as I was fully aware what my education cost my parents. At times our budget was very stretched but we saved even when it was tight and we went without luxuries, eBay clothes for myself and DC 🙂DD1 at uni now and costing about £8k a year in rent. DD2 will go (if grades achieved!) just as DD1 graduates. Both know we cannot afford London university costs (but nor could my parents in the late 1980s) and thankfully DD2 did not like Bath university as accomodation costs there very high.

We haven't specifically saved for uni, but we do own two properties, one of which I will sell. So the savings are in there really. Just deciding how much needs to go in each pot. Once we are financially stable (in a year or so), we should be able to save a grand a month for them, so not freaking out, just haven't put the plans in place yet.

We didn’t save beforehand and it cost around 6k per DC per year, this was 4-8 years ago.