University Money Issues: Grants, Loans and 10 Other Useful Financial Tips for Undergraduates
Tuition fees and student debt are sadly never far from the eye of the media these days, a fact that has unfortunately led many students to question seriously whether or not university is worth the money.
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The fact of the matter is that today’s students are faced with unprecedented levels of debt, and that’s a scary prospect for those still at school and wondering what to do next.
While a detailed debate on the merits of a university degree is beyond the scope of this article, and whether or not it’s worth the money is ultimately a matter of personal opinion, what we offer in this guide is a look at the current situation and funding options for those who are feeling confused about what they’ll need to pay in order to go to university — and how they’ll pay it.
1. What fees will you have to pay?
As you’ve probably heard, tuition fees have risen sharply in recent years. The exact cost varies from university to university, or even from course to course, but at the time of writing, universities in England are at liberty to charge up to £9,000 a year in tuition fees alone. On top of this, you’ll have to factor in living costs, covering accommodation, food, books and so on.
2. What loans and grants are available?
The good news is that there are loans available to all students, regardless of household income, to cover the costs of tuition fees and living costs while at university. You’ll get a Tuition Fee Loan, which will mean that your tuition fees will be paid directly to the university by the Student Loans Company, to be paid back by you later on. You’ll also be able to apply for a Maintenance Loan to cover your living costs, paid into your bank account at the beginning of each term (or each month if you’re in Scotland). You can check whether you’re eligible for student finance here and apply online here.
3. How much will you get?
How much you get will depend on a number of factors, such as whether you’re living at home, or in London, and you can consult the table on the Gov.uk website to find out how much you could be entitled to, or use the handy student finance calculator.
Note that students from Scotland should consult the Student Awards Agency for Scotland for information; those from Wales should refer to Student Finance Wales and those from Northern Ireland, Student Finance NI.
Both the Tuition Fee and Maintenance Loans will have to be paid back once you’re finished your studies, and once you’re earning above a certain threshold (currently £21,000 — more details here). These loans offer low interest rates — currently the rate of inflation, plus up to 3% for higher incomes (details here) — so you won’t end up paying back a crippling amount extra in interest.
Students from lower income families can also apply for means-tested Maintenance Grants, which don’t have to be paid back. You apply for all of these loans and grants at the same time, but you’ll need to supply details of your household income to prove your eligibility for non-repayable grants. You’ll find more details on the extra help available for students from poorer backgrounds here.
Later in this article, we’ll come on to the topic of the grants and scholarships that may be available to you whilst at university.
4. The Student Loans Company
Funding for your degree — the Tuition Fee Loan and Maintenance Loan and Grant — is masterminded by the Student Loans Company, a Government-owned organisation that provides loans to students, including actually paying tuition fees directly to universities and colleges on students’ behalf (to be paid back by you later). The funding available from the Student Loans Company varies according to where you live. Click the links on this page to find further information that’s relevant to you.
5. Saving money before university
Your student loans should cover your tuition fees and basic accommodation costs, but if you’re not eligible for a Maintenance Grant, your funding is unlikely to cover additional expenses, of which there will inevitably be more than you expect. To give you an idea, here are just a few you’ll probably need to budget for:
– Food and drink
– Toiletries
– Laundry
– Medicines, e.g. painkillers or throat sweets
– Books
– Study materials, e.g. pens, paper
– Clothes and shoes
– Nights out, e.g. restaurants, bars, cinema, etc.
– Fancy dress costumes for university parties
– Extracurricular activities and related gear (e.g. rugby kit)
– University hoodie or other merchandise
– Photocopying
– Birthday presents for friends
– Trips for part of your course
– Car (if you’re one of the lucky few to be taking one to university!), insurance, tax and fuel
– Train and bus tickets for visiting parents or friends
So how can you go about earning enough money to supplement your student loan and pay for all this? The work you put in to earn money and save before university will ease the financial pressure when you get to university, helping with day-to-day essentials such as food shopping, as well as allowing you to splash out on a few ‘luxuries’, such as nights out. It’s important to think ahead — university may seem a long way off, and you may have things you’d rather spend your money on immediately, but it will come round quicker than you think — and you may live to regret buying that new pair of shoes or computer game that you didn’t need when you’re at the supermarket checkout and haven’t got the money to pay!
Let’s look at a few possible ways of bringing in some extra cash and boosting your savings account before you get to university.
6. Weekend and holiday jobs
Many A-level students choose to take a weekend job while still studying for exams. Be careful with this, because however much you need the money, you don’t want a weekend job to jeopardise your studies and ruin your chances of making your grades! If you think you can manage it, though, try to get a Saturday job.
If you’d rather devote your whole time to your studies, you could wait until all your exams are over and then take a full-time holiday job over the summer. If you can, see if you can arrange with your employer at the end of the summer to take you back in your forthcoming university holidays.
Here are a few tips for applying for weekend or holiday jobs:
– Update your CV — make sure your CV is up to scratch with details of any work experience you have, the grades you’ve achieved and are predicted at school and in what subjects, any extracurricular activities you take part in and why they give you skills that are relevant for the workplace (for example, an orchestra demonstrates good teamwork), and contact details of two people willing to provide references (such as a teacher or your head of year).
– Include a covering letter — don’t just send in your unaccompanied CV; write a covering letter explaining why you think you’d be suitable for the job.
– Check your English — typos and spelling or grammar errors are a huge no-no and may get your job application dismissed outright, so make sure you proofread your CV and covering letter (or get someone else to do so).
– Be smart, and be on time — if you’re called for an interview, dress smartly and cleanly, and make sure you’re on time. If you’re not punctual for an interview, why should the employer assume you’ll be punctual when going to work for them? Arrive early and allow time for traffic delays, parking and finding the location.
While it can be difficult to motivate yourself to spend your free time on working, comfort yourself with the thought of how much easier things will be at university with a bit of money behind you — and it’ll be valuable work experience for your CV too!
7. Other ways of earning money
In addition to getting a weekend and/or holiday job, there are a few other things you can do to boost your savings in your spare time.
– Sell the stuff you don’t need — hold a car boot or garage sale and get rid of the things you don’t need in exchange for cash. Alternatively, get onto eBay or Gumtree and start listing some adverts. You’d be surprised how much you can make just by selling off unwanted possessions you have lying around the house.
– Babysitting — know anyone who needs a babysitter? If not, why not try advertising your services locally? It’s a great way of earning a bit of extra cash in the evenings, and you’ll probably be able to do some studying at the same time!
– Dog-walking — again, try advertising dog-walking services locally. Not only will this raise you a bit of money, but it’ll also get you out in the fresh air doing some exercise, providing a source of relaxation from the stress of A-level study.
– Article-writing — fancy your skills as a writer? There’s lots of demand for article writers online right now, so why not register for a site such as Copify and start earning in your spare time. If you’re suffering from essay fatigue, however, this may not be the right money-making option for you!
8. Asking relatives for money
Asking for money is always awkward — especially for us Brits! If you think your relatives may be in a position to help you out by contributing to your university living costs, here are a few simple rules for broaching the topic carefully:
– Don’t ask anyone whom you know is pushed for cash — that’s just rude!
– Be tactful –– don’t put pressure on or emotionally blackmail anybody.
– Explain the facts — a few figures will help explain why you need financial help — such as the average amount of student debt.
– Don’t promise to pay anybody back by a certain time — the last thing you need is to saddle yourself with the pressure of even more debt that you can’t guarantee you’ll be in a position to pay back. Explain that you’re not sure when or if you’ll be able to pay the money back, but sweeten the deal with the offer to cook them a nice meal or bake a cake to say thanks!
Finally, try not to rely too much on your parents for money if you can help it. University is about finding your independence and making the transition to the world of work, so unless times get really tough, try to take responsibility for earning your own keep.
9. While you’re at university
Hopefully by the time you arrive at university you’ll have saved up some money and have a bit of a ‘cushion’ in your bank account. Of course, you’ll have to manage your money carefully — try to budget for costs such as food and stick to that budget, and take advantage of the generous student discounts you’ll have available to you.
If you’re lucky, there may also be other funding opportunities available to you once you actually arrive at university.
10. Grants, Bursaries and Scholarships
Many universities offer generous grants and scholarships to students, particularly those from poorer backgrounds, to help cover day-to-day living costs (these would be in addition to your Government funding). These vary from university to university, so if you think finance is going to be a problem, investigate what’s available while you’re still choosing universities to apply to.
Many Oxbridge colleges offer book grants to cover the costs of buying books you ideally need to own a copy of rather than relying on library copies being available. Similarly, there may be travel grants available to help towards the costs of trips you may have to take as part of your course (for example, a study trip to Paris if you’re studying art history).
You may also find that there are scholarship opportunities specifically for your subject, so it’s worth hunting around to find out what’s available.
11. Part-time and holiday work
Some universities — notably Oxford and Cambridge, with their short terms — don’t like students having a part-time job during term time, so it’s best to check with your tutor before taking on any paid work. Even some Oxbridge colleges are happy for students to do a little part-time work in the library or JCR bar to earn a bit of extra pocket money during term time.
Failing that, get yourself a holiday job to earn money between terms. If you had a part-time job before you went to university, you could see if they’ll take you back for the holidays.
12. Everything’s going to be OK
It’s easy to panic when you read the costs involved in studying for a university degree, but try not to. A good degree opens up career opportunities and can help you achieve a higher salary upon graduation. Furthermore, the life skills you’ll pick up in your years at university are priceless. You won’t need to pay anything back until you’re earning a reasonable salary, and each repayment will come straight out of your salary before you even notice, like tax — so at that point you can just forget all about it!
Last reviewed: November 2014
Next review: November 2015
Image credits: banner; money; cheese; shop; dogs; thank you; library.