When looking at your options after completing your level 3 course the one thing that may put you off applying to university is the concern that you will leave with, not only your shiny new qualification, but also with a large debt. This may be the first time that you have had to manage your own money which can be both confusing and worrying. This post aims to give a simple break down of the basic elements of student finance.
Tuition fees
These are the fees that universities and colleges charge you to cover the basic elements of your course and access to resource materials. The amount they charge can vary and depends on where you vcome from and where you are going to study. Currently, for example, if you’re from England you will pay £9,250 wherever you choose to study in the UK.
These normally cover:
Lectures and tutorials
Course admin fees
Access to specific course related facilities and equipment, for example fashion and textile workshops and dance studios
Student support services
Membership of the students union
Essential course field trips
Graduation ceremony
They don’t usually cover:
Printing or photocopying in the library or IT facility
Field trips that aren’t compulsory
Textbooks and course materials such as fabric or dancewear
Membership to any clubs or societies
Living costs- accommodation, food, and travel
Graduation clothing, photography, or tickets for guests
Budgeting
When looking at how much money you will need while at university you will need to consider a number of different things. It’s worth creating a university budget to help you work out where you might have to make savings and how much money you might need to borrow. You will need to consider the cost of tuition, accommodation, food, travel, utility and other bills, clothes, holidays, socialising, and other contingencies such as unexpected travel costs and other non-essentials.
What is a student loan?
You are not expected to pay the tuition fees before you start your course, though you can if you want to. Once your application has been processed your fees are automatically paid by the Student Loans Company. To be able to qualify for a student loan you must be studying at a recognised college or university on a full-time course, which can legally award degrees or be affiliated with an institution that can. You need to be a UK national or have settled status and have been living in the UK for at least 3 years before you start your course. In England you will need to apply to Student Finance England at the start of each academic year as circumstances and entitlements can change.
A student loan is made up of two parts, a tuition fee loan to cover the not cost of your tuition fees and a maintenance loan to help you with living costs while you are studying.
tuition fee loans are paid directly to your college or university so you will not see the money.
Maintenance loans are awarded on a sliding scale. They are means tested based on your household income. This system means that they may need to contribute to your living costs while you are studying.
Loan repayments
Student loans will need to be paid back once your course has finished and you start earning. This starts at the earliest in the April after your course finishes. You will be charged interest on your loans from the moment you take them out, even while you are studying. Interest is charged on a sliding scale with a maximum amount limited to 3% above the Retail Price Index.
For students starting in September 2023, you will repay your loan over a 40 year period and you will only start paying once you earn over a certain threshold. From September the threshold for repayments will be £25,000. Once your salary is above this you will pay back 9% of everything you earn before tax. Your employer will deduct the repayments from your salary before you get it, like income tax, so the amount that is paid into your bank has already had it removed. If you don’t earn above the threshold, you won’t be required to make any payments although interest will still continue to be added. Most people will never pay back the whole amount, so it is more like a graduate tax with the higher earners paying more over time. After 40 years any outstanding loan amounts are written off.
If you’ve started repaying your loans and you lose your job or start to work fewer hours your repayments will change to reflect this.
For example;
• If you earn £28,000 in a year, what do you repay?
The answer is £270, as £28,000 is £3,000 above the threshold and 9% of £3,000 is £270.
• And if you earn £35,000, what do you repay?
The answer is £900. £35,000 is £10,000 above the threshold and 9% of that is £900.
Other funding
Even if you are in receipt of both of these loans you may find funding your life at university a challenge. Lots of students get part time jobs although this may not be an option for you if you have a very challenging course. There are other sources of funding that you can apply for in the form of bursaries or scholarships. These are funds that have been set up by public or private bodies to give extra help to students that need it or who have shown promise in specific areas.
Foundation courses
If you are doing a foundation course before starting a degree you will not be eligible for a student loan and will therefore need to find the funds to cover your fees and any living costs. There are different types of support available for you if you fall into this scenario. The first place to check would be the website of the college or university you are hoping to attend, scroll right down to the bottom, find access and participation or access and diversity to see what support they offer prospective students. It is also worth looking at these 2 websites to find out what is available
https://www.ucas.com/finance/scholarships-grants-and-bursaries
https://www.thescholarshiphub.org.uk/guide-to-uk-scholarships/