According to the latest Student Money Survey from Save The Student, 61% of university students in the UK say that their maintenance loan is not enough to live on.
So what are those studying to do when their student finances doesn’t quite stretch far enough? In this article, the Best Short Term Loans team will guide you through your options to finance your studies in 2019.
The cost of university
If over £9k a year in tuition fees wasn’t enough, research has shown that students across the UK are struggling to afford the everyday essential items while studying. Here is Save The Student’s breakdown of the average university student’s spending:
|Expense||Average per month|
With the average maintenance loan falling at just £600 per month, there is a clear gap between the funding students are being given and the actual money they need to survive. Many also added that their maintenance loan did not even cover the cost of their rent; leaving them with no money for the rest of the year.
These figures also fail to take into account many of the hidden costs for specific courses. This could include expensive books for wider reading, course-specific equipment and clothing, field trips, printing costs, and various tech.
Which? University reported cases of students paying between £100 and £1000 for the necessary equipment for their course; cutting into their already overstretched budgets considerably.
1. Help from parents
With the Save The Student survey finding that 73% of students survive on money from their parents, it would seem that many have the option of leaning on the ‘Bank of Mum and Dad’ through university.
It also found that the average student receives £138.50 a month from their parents; bridging the gap between their maintenance loan and actual living costs. While it may seem that these parents are just being helpful, the government not only expects this contribution from parents, but they actually base student finance awards around it.
Each household’s income is taken into account, as well as the student’s living situation, to determine how much money they will be given by the government.
Essentially, the more money the parents earn, the more they will be expected to contribute. Save The Student published a breakdown of the maintenance loan a student would be entitled to, based on their parents’ earnings.
For a student starting university in or after 2016, who live away from home but outside of London, the maintenance loan and expected parental contribution would change as follows:
|Combined household income (all adults living in the student’s home)||Maintenance loan awarded by the government||Expected parental contribution|
Many argue that this system is unfair, particularly for students whose parents are unable or unwilling to give them the money they need to survive.
It also creates a difficult situation for parents supporting more than one child through university. And, since there is no legal way of forcing parents to make up this difference, students are often left with few options to afford living costs.
If your parents are unable to help finance your studies this year, you may need to look into alternative methods of supplementing your maintenance loan.
2. Part-time work
Many students without access to help from their parents choose to support themselves by working part-time in addition to their course.
76% of students in the survey said they had a part-time job, either during the term or as temporary work in the holidays.
The obvious issue with this option is, while being both a full-time student and a part-time worker, you’re going to be busy. If you choose to work during your course, it can be difficult to juggle working hours with sufficient time to study and a social life. Finding the right balance for you is key.
Which? advise that “if your uni workload means a regular part-time job would be difficult, think about other money-earning ideas where you don’t have to commit to the same hours each week.” Alternatively, if you want to focus 100% on your studies during term time, “the holidays between terms are an excellent opportunity to earn some money for the term ahead.”
While most full-time students won’t be able to claim income-related benefits, certain students may still be eligible. You may be able to make a claim if you:
- are a lone parent, or
- have a partner who is also a student, and at least one of you is both responsible for a child and have a disability (qualifying for the disability premium or severe disability premium of income-related Employment and Support Allowance).
If your partner is not a student but is eligible for any income-related benefits, they can claim on your behalf for your household.
Part-time students on a low income may also be entitled to certain benefits if they meet certain criteria. Take a look at the NI Direct website to learn more.
4. Grants or scholarships
Universities often offer their own grants and scholarships that you may be able to apply for. While the money does not need to be repaid, these grants are often only given for certain course subjects, like sports or sciences.
There are, however, a wide range of different grants and scholarships available with some very diverse criteria. Some may give a bursary depending on your parents’ jobs, your predicted grades, and even your surname!
The Complete University Guide has some great advice on finding an appropriate university scholarship or grant for you.
5. Unsecured personal loans
Personal loans allow you to borrow a specific amount of money for a set amount of time. Since they are often unsecured, you don’t need to own a house to use as security on the money you borrow; making them ideal for students.
Thinking back to the many hidden costs associated with studying at university, short-term personal loans can be a helpful, temporary solution to getting the equipment you need to start your course without draining your bank account for the rest of the term!
In addition to helping you get your hands on the books, materials, and clothing you need for your studies, short-term loans may also help you to improve your credit rating. As long as you only borrow as much as you can afford, and you meet your monthly repayments, your credit score may edge higher; increasing your chances of being accepted for larger loans and mortgages after you graduate.
The main issue to consider is that, if you apply for too many personal loans in a short amount of time, this can have a detrimental effect on your credit rating. That’s because every loan application requires a “hard search” of your credit file; which remain visible to lenders for many years.
That is where working with an FCA-authorised loan broker can help you narrow down your options to the lenders most likely to accept you for credit.
Looking for a loan as a student?
At Best Short Term Loans, we’re highly experienced credit brokers – not lenders.
That means we can help you find the best possible lender for your unsecured personal loan. Simply enter your details into our clever computer system, and we’ll let you compare rates from some of the top lenders in the country.
We do all the hard work for you and our service is completely free of charge. So if you need money to help fund your studies without cutting into your maintenance budget, speak to Best Short Term Loans today.