Factsheet 4

Money matters

When you go to university or college, you have to think about tuition fees and how you will pay for accommodation, travel, food, books, going out and so on.

The good news is that there is plenty of help available - though you should not expect to be living a life of luxury! Most people think it is well worth investing in higher education even if it means being a bit hard up for a few years, because they are more likely to get a bigger salary at the end of it.

The Government helps by paying towards the cost of tuition fees, and by giving loans and some grants towards living costs.

Important note

To find out more about the financial help available for students in higher education you can visit www.aimhigher.ac.uk or you can call the Student Loans Company Customer Support Office on 08456 077577 between 6am and midnight every day. However, if you have a detailed question about your likely entitlement then you can contact your Local Education Authority (the number is in the phone book) and ask to speak to the student awards officer.

Further information can also be found in our booklet 'How to Get Financial Help as a Student' which is available free of charge by calling 0800 587 8500.

Fees from September 2006

From September 2006 universities and colleges in England will be able to vary the tuition fees they charge for new starters from £0 to £3,000 per year. However, full-time students will be able to apply for a loan to cover the cost of their tuition fees.

Any maintenance loans will be added to the tuition fee loans and the student will not have to make any repayments until they have left university and are earning more than £15,000 a year. Repayments linked to income mean the more you earn, the more you repay, and the less you earn, the less you repay.

The actual cost of fees will depend on which college or university you decide to go to and which course you take. The most that any university or college will be able to charge for fees (until 2010 or later) will be £3,000 a year.

Student loans

From 2006, there will be two sorts of student loan: loans for maintenance and loans for fees.

Loans for maintenance

Student maintenance loans can help towards the costs of your general living expenses. These are not commercial loans like those offered by high street banks or building societies who aim to make a profit. It has an interest rate linked to inflation so that the money you repay is the same in real terms as the money you originally borrowed. This means that the Student Loans Company does not make any profit from the loans.

The loan amount depends on your own circumstances, as well as where you live while you study. The loan is less for students who live at home. Students on part-time, initial teacher training courses are eligible for the full student loan as well as the other support available to full-time students.

Loans for fees

From 2006, students will be able to take a loan out to cover their fees if they need to. They will then be able to defer paying this loan until after they have left their course and are earning over £15,000.

If a student decides to take out a fee loan to cover their tuition fees, the SLC will make any fee payment straight to their university or college. The amount of fee loan a student can take out will be linked directly to how much their college or university charges for their chosen course.

Paying back the fee loan will work in much the same way as the maintenance loan, which means that students will not have to pay anything back until after they’ve left their course and are earning over £15,000 a year.

When students have left higher education, any loans for maintenance will be added to any loans for fees into a single amount. Students only start to repay when they are earning above £15,000. They will pay back 9% of their earnings over £15,000 a year, so someone earning £20,000 a year would repay around £9 per week.

Part time students

If you are planning to study part-time - including with the Open University - for the equivalent of 50 per cent or more of a full-time course, you may qualify for a fee grant of up to £885 a year and a course grant of up to £250 a year. You will not have to pay tuition fees if you are on an income below £14,970 or get any of these benefits:

• Council Tax Benefit
• Housing Benefit
• Income Support
• Job Seeker’s Allowance
• New Deal Allowance

If you already get benefits, becoming a student can be seen as a ‘change of circumstances’. Check with your local DWP or Jobcentre Plus to see if studying at university might affect your benefit. Those on higher incomes may get partial support.

What other help is available for 2006?

For new students starting in 2006 or later the Government will provide a grant of up to £2,700 (non-repayable) for full-time students from lower income households. Students with a household income of £17,500 or less will get the full grant and students with a household income of £17,501 to £37,425 will get a partial grant.

University bursaries, grants and sponsorships

From 2006, any university that charges the maximum fee of £3,000 a year will have to provide financial support, such as bursaries, worth at least £300 to students on those courses who are receiving the full £2,700 maintenance grant. Many universities and colleges are offering more. It is worth contacting your university or college to see what is available. For further information you can also look at www.aimhigher.ac.uk

Teacher training incentives

Apply for funding from your local education authority (LEA) if you are going to do initial teacher training (ITT) full-time or part-time. There are reduced fees for undergraduate ITT courses and there are no fees for postgraduate teacher training. For more information on this call the Teacher Training Agency’s Information Line on 0845 6000 991. Or visit the website at www.canteach.gov.uk

National Health Service Bursaries

Students with a National Health Service (NHS) funded place on a full-time or part-time pre-registration health professional course can apply for NHS bursaries. If you register for a course of this kind, you will automatically be sent information about how to apply. For some students studying medical or dental courses, these NHS Bursaries should be available for your later years of study. For more information check out the NHS careers website at www.nhs.uk/careers

Access to Learning Fund

The Access to Learning Fund is available through your college or university and provides help for students on low incomes who may need extra financial support for their course and to stay in higher education. Contact your college or university for more information. The good news is that this money does not usually have to be repaid.

Career Development Loans

Career Development Loans are backed by the Government and available through three high street banks. They’re loans of between £300 and £8,000 to pay for up to two years of vocational education or training. Study can be fulltime, part-time or by distance learning. No repayments are made during the period of training and for one month afterwards. After this you have to pay the loan and any further interest.

If you have children or dependants

If you’re studying full-time and have children in registered and approved childcare, you could get a Childcare Grant. You may be able to get up to £148.75 a week for one child, or up to £225 a week for two or more children. How much help you get will depend on your circumstances. You may also be able to get a Parents’ Learning Allowance if you have dependant children. How much you get will depend on your income and that of your dependants. If you have an adult who depends on you, you may also be able to get an Adult Dependant’s Grant worth up to £2,395 a year. None of the help mentioned here has to be repaid. Get more information from the booklet ‘Childcare Grant and other support for student parents in higher education’. You can get this by calling 0800 731 9133.

Disabled Students Allowances (DSAs)

These help with the extra costs you have as a result of attending your course and as direct result of your disability. The Department for Education and Skills (DfES) produces a booklet called Bridging the Gap, which provides information about these allowances. Call 0800 731 9133 for a copy. Copies are also available in audio, Braille, and large print.

Young People Leaving Care

The Children (Leaving Care) Act 2000 came into force on 01 October 2001. Young people who are eligible for leaving care services since that date will have a pathway plan and a personal advisor. The local authority responsible for your pathway plan will have a duty to meet their needs in relation to education, training or employment. If necessary this will include helping these students with the costs of accommodation during the holidays. Students should speak to their social worker or personal advisor to find out more.