Students in the UK will enter college or university this autumn amid a cost of living crisis.
The prices of energy, food, rent and other essential goods are increasing.
What financial support is there?
The details depend on where you live in the UK, but student loans typically consist of two elements:
- a loan for training costs
- a maintenance loan to cover living expenses
Most people are entitled to that tuition fee Element equivalent to the annual cost of your course up to £9,250 per year capped through the 2024/2025 academic year.
That maintenance loan is intended to cover accommodation, meals, books and any equipment you may need. It is means-tested, so the amount depends on your family’s household income.
You may receive extra money if you are disabled or have children.
If you are under the age of 25 and have no contact with your parents, you may be able to apply as an “foreign student”. This means that the financial situation of your parents is not taken into account.
The level of maintenance assistance available varies across the UK.
- students out England can use the Loan Calculator on the Student Finance England website
- students out Wales can go to Student Finance Wales
- students out Scotland may go to the Student Awards Agency Scotland
- students out Northern Ireland can go to Student Finance Northern Ireland
Although the main deadlines for first-year students and returners have already passed, students can still apply for help for the 2022/23 academic year.
The process varies depending on where you live:
- The Student Loans Company processes all applications for students in England and Wales
- students a Scotland apply through the Students Awards Agency Scotland
- students out Northern Ireland Apply through Student Finance Northern Ireland.
The Student Loans Company says applications for both elements of the loan can be made up to nine months after the start of the freshman year.
That training costs A portion is paid directly to your university or education provider.
That maintenance loan will be sent directly to your bank account and if you have applied before the deadline you should have the money before the course starts.
You will be charged interest on the loan from the day you take it out, but the amount varies across the UK.
It is important to understand that the terms can change after you have borrowed the money.
in the England and Wales The undergraduate interest rate is calculated by adding 3% to the Retail Price Index (RPI) inflation measure.
In June it was announced that the interest rate for new students starting in September 2022 would be capped at 7.3%. It had been expected to rise to 12% as inflation has risen so much.
From September 2023, the interest rate for freshmen is to be only RPI.
For courses in Scotlandthe rate is currently 1.5%, for courses in Northern Irelandthe rate is currently also 1.5%.
After graduation, the interest rate depends on how much money you earn.
- Cost of Living Crisis: Concerns about the Impact on Students
- What is inflation and why is the cost of living rising?
You don’t have to repay your loan until you make a certain amount of money after graduation.
Payments are made automatically through the tax system.
You typically pay back 9% of the amount you earn above the threshold.
However, the amount you can earn before you have to start paying back varies across the UK.
in the England and Walesthe threshold is currently £27,295 but will drop to £25,000 in September 2023.
in the Scotland the threshold is already at £25,000, and in Northern Ireland it’s £20,000.
You pay nothing back if you earn less than the threshold.
Under the current system, student loans are typically amortized after 30 years, but much remains owed
However, the government plans to extend this period to 40 years.
Even if you drop out of your studies early, you still have to pay back your student loan.
Some people may choose to make additional repayments to prepay part or all of the loan – there is no penalty for this.
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