Introduction

We’ve written this blog to give you a bit more of an insight into how you pay back your student loans, the fees, how much you can borrow, and how to best manage your money. We hope it helps!

Tuition Fee Loan

Tuition fees, in most of the UK, are £9250 per year for full-time home students, and more for international students. Here are some of the things that your tuition fee would usually cover:

• lectures, seminars, and tutorials
• course admin costs
• access to course-related facilities and equipment (e.g. laboratories, studios) 
• access to campus libraries and computer rooms
• support services for students
• student union membership
• field trips essential for completion of your course (travel and accommodation only)
• graduation ceremony

Your tuition fee loan will be paid directly to your course provider, and you won’t have to pay it back until after completion of your degree and you are earning over a certain threshold.

Source – https://www.ucas.com/finance/undergraduate-tuition-fees-and-student-loans#:~:text=Student%20loans%20can%20include%20a,earning%20above%20a%20certain%20level.

Maintenance Loans

Maintenance loans are in place to help you with some of your living costs during your time at university. It will help with covering things such as accommodation, transport, groceries, leisure activities, books and equipment.

You will usually receive your maintenance loan in three equal instalments throughout the year; normally at the start of term, at the start of the new year, and the final instalment is paid around April.

This will be paid directly to your bank account (the details of which you provide when you first apply for the maintenance loan).

There are a few factors that will determine the size of the maintenance loan that you are entitled to. 

1. Which part of the UK you are from. England, Northern Ireland, Scotland and Wales have different funding bodies for students. You apply to the funding body of the country you reside in, regardless of whether or not you’ll be studying there
2. Whether you are living at home or not – usually students who live away from home are entitled to a higher maintenance loan. Even more funding is available for students living in London due to the inflated cost of living there.
3. Your household income. Regardless of whether your parents/partner will be helping you financially at university or not, the amount you are entitled to depends on your household’s total income.

Maintenance loans in England 2022/23

Paying back your loan

You will only begin to pay back your tuition and maintenance loans once you are earning above the income threshold of £27,295 per annum, before tax (as of October 2022).

The table below gives some examples of different salaries and the monthly repayment you will make.

When you finish your degree and are due to start repaying, regardless of whether you are earning above or below the threshold, the loan will be cancelled after 30 years if you haven’t finished paying it back. 

So, if you happen to earn under the threshold each year for the next 30 years after you graduate, you won’t actually have to pay back any of your loan.

Interest

• Interest is applied to your loan from the day that payment is first made, until the day that the loan is satisfied or cancelled. This can add thousands of pounds to your student debt.
• Student loan interest is usually increased in line with the Retail Prices Index (RPI), which is an indication of inflation level published monthly by the Office for National Statistics. 
• As inflation is at a high that hasn’t been seen in decades, the government has temporarily put a cap on the interest that students and graduates will have to pay. The interest rate is currently at 6.3%, but this is reviewed every September.

Financial struggles at university

We’ve all heard the stereotype of the student who lives on baked beans and has only a few pounds to last the rest of the month.

Sadly, this is not too far off from reality for some students; almost anywhere in the UK, the minimum maintenance loan will not cover all of your living costs, especially if you are living away from home or in a region with high living costs. 

As the size of your maintenance loan entitlement is based heavily on your household’s income, there is often an unfair disadvantage to some students, as there is the assumption that if household earnings are over a certain amount you can be aided financially by your parents. 

Of course, this is not always the case. Many students will have to make up the difference between their maintenance loan and their actual living costs themselves. This could mean getting a part-time job, applying for extra financial aid, or cutting down on your spending.

Getting a part time job at university

A part-time job whilst at university is a great way to earn some more money, get a change of scenery, and maybe even make some new friends.

Although finding a job can be tedious and time-consuming, it’s definitely not impossible! Below are our tips for finding a job whilst studying:

• • Get ahead of the curve. Thousands of students will be moving back to university around the same time every year, so it’s important to start your job search as early as possible.
  • Have a look at your university’s job board. Your university or Student Union will often advertise jobs either on site, or in the local community. Check these out as they will often be fairly well-paid opportunities that fit in with your studies. 

• Optimise your CV. It’s good practice to have a CV on hand that is up-to-date. Make sure that your CV properly represents your skills, experiences and academic achievements; this will help you stand out to potential employers.

• Be clear about your time commitments. Be honest with anyone hiring you that you are a student, and have certain time commitments. Ensure that your work schedule aligns well with your university timetable, to avoid stress and burn out later down the line.

Budgeting

When you first arrive at university as a fresher it’s so easy to get caught up in the fun and newfound freedom, and spend hundreds of pounds on nights out, takeaways and other splurges. Although this is great fun, you’ll quickly realise that it isn’t sustainable. 

Budgeting whilst at university might be difficult, but it’s important that you try to stick to a plan and spend your money wisely.

• Be thrifty with your food shops. If your parents always went to the supermarket and paid for your food, it might be a shock to the system when you have to take on this responsibility by yourself- food is expensive! 

Set aside a fixed amount of money each week/fortnight/month to cover your food shop. 

If possible, try to stick to cheaper supermarkets such as Lidl and Aldi, where off-brand alternatives can make your shop much cheaper. 

Make a meal plan! Knowing what meals you are cooking, and which ingredients you need can save you from making unnecessary purchases. 

• Budget your nights out. Clubbing, going to bars and eating out can all be very expensive activities. They are also activities that you will almost certainly be partaking in whilst at university.

Lay out a set amount of money for leisure activities. This will help with spending more than you can afford on nights out.

Learn to say NO. You don’t always have to go out if your friends ask you to. It can be tough to feel like you’re being boring, or that you are going to miss out. Financial security should be a priority, and your friends should understand that. There are many cheap, or free, activities that you could suggest instead- maybe a home movie night, or cooking a nice dinner together!

Hopefully there’s been some useful information in this blog, below I’ve linked Save the Student’s website, they have some really good information on student life and general advice, especially through these turbulent times.

https://www.savethestudent.org/