Student Finance: What You Need to Know
Applying to university and mapping out your future are both learning experiences themselves, and this all happens before your first day at term as an undergraduate! However, most students forget about the amount of information that they need to learn about student finance and the student loans company – for example, how you’re going to pay for your course fees, student accommodation, textbooks and live during your time studying. Although we all wish that these funds somehow appeared into our student bank accounts, with no questions asked and a smiley face – that isn’t going to happen. This is all that you need to know about student finance, and why it is important to learn them in advance of applying.
Firstly, what is student finance? Student finance, part of the student loans company, is a loan system, in connection with the government that helps students (no matter how old they are, from the age of 18 and up to 60) with their fees. This financial support is different from standard loans, grants or scholarships. Student finance initially pays your tuition fees – the amount it costs to solely be allowed on the course at your institution, and at the moment they can be as high as £9,000 a year. Any student above the age of 18, who is studying at a higher education institution or course, can apply for student finance to pay their course fees for them, and then pay back the loan later on after the course has finished.
This type of loan is extremely helpful as most students aren’t able to save up the amount of £27,000 in a lump sum to pay for their tuition (or if they did it would take a really, really, really long time). The interest rate on student finance loans are significantly lower than a standard loan that people can get from a bank, and comes with less personal terms and conditions you might receive if you borrowed the money from a family member – it would make Holidays a bit tense!
Student finance offers other types of loans and grants too. There are maintenance loans which are a set amount students receive each year to aid with their living costs – which would include rent/accommodation, travel, textbooks, student houseing utility bills and any other finances concerning studying. Students do have to pay this amount back, and student finance usually uses a means-tested system to allocate their funds. Means-tested equates to student finance seeing how much you, and/or your household (partner, or parents) earn and calculate how much help they can provide. Also, maintenance grants are similar, but are categorised as separate because students who are awarded these do not have to pay them back. Students have to pay back maintenance loans but do not have to pay back maintenance grants from student finance. These grants are also means-tested, so the amount that each individual student may receive is dependent on their income and situation.
New and existing students are able to apply for this funding via the student finance website. They – depending on if they are full or part-time, or living at home, etc. – and their parents will have to create an account online. Once an account is created, students can fill out the online application for the loan and grant, be informed on what evidence they need to send (this usually is your parent(s) proof of income, etc.), and find out how much they are entitled to receive. The website also features the dates on when students should expect their payments, how to set up student loan repayments and check what correspondence/letters they have received from the company in case they have misplaced them!
Maintenance loans and grants from student finance are given to students three times a year. Their cash entitlement is split up into three amounts and paid into their account at the beginning of each academic term. University terms usually are from September to December, January to March, and April to June, however, it does depend on your institution’s term timetable as this can change. The hardest part of the student finance process that most students find difficulty with is being able to budget as student, there is a big sum of money that needs to last for three months. It can be tempting to see this amount in your bank account as free money! (Trust us, we made that mistake before!)
Next up we have scholarships and bursaries which aren’t connected to student finance at all, but can be easily be mistaken to be! Scholarships and bursaries are generally down to your institution, college or university, decision and have their individual eligibility criteria. Some universities offer cash bursaries – where you physically receive money – for students from households with a smaller income than the average, can offer scholarships that can lower the amount of tuition fees students have to pay and so on. To understand what scholarships and bursaries your university may have on offer, and if you are able to apply for them, you can visit your university’s website or contact them.