Last week we looked at Student Loans to help pay for your Tuition Fees when you go to Uni, but what about paying for your living costs and accommodation?
Aside from the lucky few who will be in flats or houses bought by their parents, the only realistic alternative to living at home is to rent. To pay the rent and other living costs, you may need to borrow the money from Student Finance England. If you do, this is called a Maintenance Loan and it is means-tested so the amount you may be entitled to is dependent on the amount of your household income.
As before, we will endeavour to keep this article very simple and provide a general overview to get you started. There are lots of exceptions and we would always encourage you to read the detail in the various Student Finance literature (see below).
Why you may need to borrow the money?
Accommodation is the single biggest expense when you’re at Uni. If you are in a city, it will generally be more expensive than if you are at a rural Uni. And the closer you want to live to the heart of the action or the centre of the student activities, the more it is also likely to cost because demand will be greater for these locations. Living on campus is a prime example, but may be a necessity if your lectures all start at 9am and you do not want to be on the early bus to Uni.
Another factor affecting the amount of your rent will be whether the accommodation is shared with a lot of other students: this could bring the cost down, but mean that you are sharing with strangers in your first year.
It will also be affected by whether you go into a Hall of Residence. This is University owned accommodation so should be more affordable, but if bills are included it is important to check like-with-like to ensure you know what you will be paying for. Similarly, if your accommodation is fully serviced (cleaned) with a laundry, ensuite and a restaurant for meals, you may want to add up the equivalent cost of paying for these facilities in private accommodation to see which is the best ‘deal’ and best suited to you.
The main thing is to ‘shop around’. Most Unis have a variety of accommodation covering both cheap and expensive options. Talk to undergraduate Ambassadors when you visit the Uni on an Open Day and consider their recommendations alongside your own requirements.
How do you arrange your accommodation?
Accommodation will be advertised within the University and locally. Some will be clearly owned by the Uni whilst others will be with private landlords. Apply late to Uni – perhaps as the result of Clearing in the Summer (more on that in a later Blog) – and all the accommodation could well be taken up – certainly the best locations.
Your best bet is to calculate the amount of Student Finance you may be entitled to using the Student Finance Calculator (see below) and determine how much you should be eligible to borrow. Just as this can help you determine which course to study, so it can help you research and choose the accommodation that you can best afford. You can generally then apply for your accommodation once you have accepted an offer of a place at a Uni.
A quick word of warning to ask you to please check the small print when arranging your accommodation. If it is in a shared house, check who is responsible should there be any ‘mishaps’. If there was a fire, for example, would the renovation costs be shared equally between the students living there whether or not it was their individual fault? And if any of them couldn’t, or didn’t, pay their share, does the cost pass to the remaining student(s) who can pay? If you are going into privately rented accommodation with strangers – or friends of friends – you may want to pay particular attention to this sort of detail before you sign on the dotted line as it could be extremely expensive!
What happens to your Maintenance Loan?
Unlike the Student Loans for your Tuition Fees, there are a few potential challenges with Maintenance Loans which mean you need to be good at budgeting.
Challenge number (1) – Assuming that you are eligible for a Maintenance Loan, it will be paid direct to your bank account. Unlike the Student Loan which is paid direct to the Uni to cover your Tuition Fees, the Maintenance Loan is given to you to help with your living expenses.
Challenge number (2) – No-one monitors how you spend it so if you choose to ‘blow’ it on other things, this will be up to you and you will need to find your rent from elsewhere, such as a part-time job.
Challenge number (3) – The Maintenance Loan is paid to you three times a year, at the start of each term. This can be inconvenient if your rent is due monthly so yet another reason to budget carefully and ensure that you have enough left over to pay the bill when it is due.
How else can you raise funds to help with living expenses?
Maintenance Loans are means-tested just like the Student Loan for your Tuition Fees, so if your parents earn quite a lot, you are unlikely to be eligible for the full amount. If your parents then don’t subsidise your income with extra cash, you may be left with quite a shortfall to make up from elsewhere to afford the accommodation you want or to afford your other living costs after paying the rent.
Fortunately, there are plenty of other ways to supplement your income at Uni. We’ll cover this in future blogs as well, but the headlines are that you may be eligible for ‘free’ money such as bursaries, grants, scholarships or a gift from the ‘Bank of Mum & Dad’. Or you may want to earn extra income, either during a gap year before you start, over the summer, or as a part-time job. And there are always additional funds from the bank such as via a student overdraft. However, the chances are that this will be limited to a set amount based on your year of study and will incur interest which means you’ll have extra to repay.
How do you pay it back?
Just like the Student Loan, you still have to pay it back when you graduate, like an extra ‘tax’ on your income when your earnings exceed £21,000 p/a. There’s more on that in last week’s Blog.
Living at home?
Currently you may be able to borrow a Maintenance Loan of over £8,000 if you live away from your parents. However, you may still be eligible to borrow over £7,000 if, instead, you choose to stay at home (more if in London). This amount still needs to be repaid later on, and still incurs interest, but living at home could mean that you save entirely on any rent, laundry bills or food costs so being able to borrow this money may take the pressure off you needing to have a part-time job and that could be really helpful if the demands of your course leaves little time – or energy – for paid employment.
There are lots of exceptions to the rule so it is important to check the websites that specialise in Student Finance to ensure you understand your personal entitlements. And there is also a helpline: 0871 976 2170
Important – some of the websites where you can find more of the detail:
- Student Finance England
- Student Finance – the Government website
- Student Finance Zone on The Student Room website
- Student Finance Calculator
- You Tube video overview – https://www.youtube.com/watch?v=yaHKUvHQXVc
And if you have applied to UWE, there is a Pre-entry Money Advice Line available where you can speak to someone at the University in the UWE Money Advice and Finance Service anytime from November to August between 2.00-4.00pm on 0117 328 5432 or email them on [email protected]
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