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April 2011

Will you stretch to university?

By | Coaching in Education, Study advice

The last few months have seen many changes to the funding and finances of higher education. The changes will take effect from September 2012 so will affect current Year 12s going into Year 13 this September. The media have succeeded in scaremongering, making many students wonder if they can afford to go to university. The answer is unequivocally – yes. Let’s go through the maths.

There are two main sets of costs associated with going to university. Firstly, there are tuition fees which are set by the university. Under the new arrangements universities in England will be able to charge up to £9,000 per year for their courses. Universities which charge the maximum fee will have to guarantee an extensive range of bursaries and scholarships, helping more people from low-income families to access their courses. The exact details of these schemes will be publicised on each university’s website. The total cost of tuition fees will depend on the length of your course, so if you study at a university that charges £9,000 per annum and study a course such as medicine which is five years long, you will pay a total of £45,000 in fees. However, none of this payment is taken upfront. The Government will pay it directly to the university on your behalf, and you will have to pay the Government back once you have an income above a certain level. It used to be the case that only full time student fees were treated in this way but, subject to parliamentary approval, students on part-time courses will also be able to pay their tuition fees after they graduate.

The other large costs associated with university are living costs. Living cost loans are available from the government. You are eligible for up to £5,500 if you live away from home and go to a university outside London, £7,675 if you live away from home and study in London and £4,375 if you live at home. You may also be eligible for living cost grants which you would not have to repay if your household income is below a certain level (under £25,000, you get £3,250 and under £42,600 you get a proportion of this). In addition, if you are disabled or have children, you are entitled to benefits from the Department of Work and Pensions. Universities also have Access to Learning Funds, an additional source of finance that they can either give or loan to students in emergencies or in times of hardship. It is worth contacting the administrative offices of universities in which you are interested to find out what is on offer. The Student Union in each university can also provide a wealth of knowledge and may have access to further funds.

You start repaying the loan from the April after you graduate, and then only if you earn £21,000 per annum or more. If you meet this criterion, then your repayments will be calculated as 9% of the part of your earnings that is above £21,000. The repayments will be taken automatically out of your monthly salary. Unfortunately – as with any other loan – your repayments will also include an element of interest. Under the planned new arrangements, interest on the loan will be charged at 3% plus inflation (RPI) while you are at university. After you leave university, the rate of interest will vary on a sliding scale in line with your earnings. Interest will continue to accrue at the rate of inflation plus 3% per annum for high earners (those paid over £41,000) but being kept no greater than the rate of inflation for those earning below £21,000. Any outstanding debt would be written off after thirty years.

When you do the sums, it is clear that most future graduates will begin their working life with significant levels of debt. Just how much will depend on where you study and for how long. For those whose degree leads to a lucrative career, the long term benefits will outweigh the initial costs of paying more for their education. Many of the traditional professions are now all but inaccessible for those without a university education, and in spite of the economic downtown, salaries for many new graduates remain high. In fact, several companies, such as GlaxoSmithKline, have announced that they will pay student fees of up to £27,000 for graduates on their training schemes providing that the employee stays with the company for a minimum time period. However, many prospective students and their families will be left wondering if accruing this level of debt is worth it. Aside from the economics, perhaps it is important that the other benefits of going to university are kept in mind. Your whole life, mindset and opportunities could change, not to mention the personal and social development that occurs during those formative years.

All of this means that choosing the right course and landing a good job after university will become even more important in the future. Competition for the top courses and jobs will become more intense, and building bridges to help you find your way into the world of work (for example, through relevant work experience and placements) will be pivotal. Interview skills and application form advice can be sought from careers professionals.

Natalie is the founder of She can discuss your career options in one-to-one sessions and give you expert guidance on your personal statement. She also offers subject-specific mentoring and help with job applications.

For more information, contact Natalie Lancer on 07747 612 513 or at

Natalie’s Top tips for getting a grip on student finances:

  • Keep a close watch on university websites and contact the relevant university for more information. Each university will publish their proposed fees for 2012/13, and it will benefit you to know as early as possible what the financial commitments could be.
  • Since universities could potentially charge different fees you can ‘shop around’ for the right degree. You should consider as early as possible what it is you want to get out of a degree and whether a particular university represents value for money. Information can be gleaned from published league tables and university websites about the quality of teaching at a particular institution, the career paths of students once they have finished there, extra-curricular activities and other course features (such as spending a year abroad or in industry).
  • Start thinking about your longer term career options and building some bridges between you and companies that may finance your degree or offer you a job once you have graduated.
  • Find out how to apply for any available scholarships the universities are funding and if you are eligible for a bursary or money from the Access to Learning Funds.
  • Talk to a careers professional such as Natalie Lancer, who can help you work out which university can offer you the best value for money and a student experience in line with your needs and career goals.