Since you’re presumably a student, or soon to be one, you’re probably interested in knowing a little bit more about student finances; especially if you’re not going to have much financial help from home, for whatever reason. And we at Unpacked think that you should be as informed as possible before heading out for university. So we present here a short primer on student finance.
As outlined at https://www.gov.uk/student-finance/overview, the financial support that you will get from the government to study will usually come under one of three categories; tuition fee loans; maintenance loans and maintenance grants.
You’re no doubt already familiar with tuition fees, £6,000 or £9,000 that you pay for your education each year, which are wholly covered by loans from the government at the time of study, on the understanding that you will be paying them back afterwards once you start earning more than £21,000 a year. Those tuition fee loans are not means tested, which means that everyone going to university is eligible for them.
The most important thing to note about tuition fees though is that you pay them back in proportion to what you earn, 9% of earnings over £21,000 to be precise. So, if you earn a grand more than that, £22,000 a year, after uni then you will pay back £90 a year; whereas if you earn £25,000 a year you will pay back £360 every year. And if you don’t earn more than £21,000 then you don’t pay a single penny of tuition fee costs. This means that some people will end up paying back the entire cost of their tuition fees, whilst others may never pay them off at all. The point is that what you pay for your degree will be dependent to some extend on how much you get out of it later in life.
On the subject of tuition fees we have heard several people talk about moving abroad to try and dodge tuition repayments after uni. There is only one flaw in this plan: it won’t work. Tuition fees are a kind of contractual agreement that you enter into with the government, they are not a tax, even though you pay them in a similar manner to tax. Therefore, you still have to pay even if you’re living abroad. Oh, and all remaining tuition fee debt is wiped after 30 years. So that’s nice.
So far however, all of this is about the cost of education, but the cost of living during that education is covered in a separate category: the maintenance loans and grants.
Maintenance loans are available to everyone, but 35% of it is means-tested, which means that it depends on your parent or guardian’s income level. The amount that you will get in a maintenance loan also depends on whether or not you are living with your parents and whether or not you’re living in London for university. If you’re living away from home and outside of London, you can get up to £5,500 in maintenance loans every year.
But, you’ll want to apply as soon as possible. You’ll still get the loan if you apply late, but it takes months for the Student Finance company to organise all those fees, loans and grants, and a lot of people end up not having their living costs covered until halfway through the first term, simply because they didn’t think to apply for everything until August. Don’t let that happen to you, if you’re attending uni this year, then apply now!
And finally, the maintenance grants. These are like maintenance loans, with one crucial difference; you don’t pay them back afterwards. Although eligibility for grants is wholly means-tested, students from households with an income of up to £40,000 are still eligible for some amount of grant, so don’t hesitate to go for them.
All of this should see you through the three or four years that you spend at university, and allow you to have fun while you’re there. And of course, don’t forget to check out www.unpacked.co.uk for all of your student household needs before you go!