Managing your finances as a mature student
By Kate Saines
Having a lack of funds is a prerequisite of being a student – and with ruthless cuts being introduced by the Coalition it's a situation set to worsen.
But if you are a 'mature' student with a family and other commitments like a mortgage, being skint takes on a whole new meaning.
The average student, it is estimated, finishes university with debts of over £23,000 – and this figure is expected to soar in the next few years.
It's the kind of debt which could financially cripple a young graduate with no ties or responsibilities let alone a student with two children, a spouse, a home to run and bills to pay.
What's more, with many 'mature' students opting for part-time study programmes to fit in with work and family commitments, there are yet more problems.
Recent research has raised concerns over the cost of part-time study and the nature of financial support available to these students.
It found government financial support was lacking because there was an assumption that part-time students must be getting help from their employers.
Yet the study, by Birkbeck University of London and the National Institute of Economic and Social Research, found just 41 per cent of part-time students received help from their employer. And, of that figure, 17 per cent had to find additional finances.
Employers tended to be selective about who they sponsored and the study found those in greatest need of financial assistance from their employer, did not get it.
Overall, only 14 per cent of part-time students received a government fee grant and for 43 per cent of them the funds they received did not cover the cost of their tuition.
Claire Callender, professor of higher education at Birkbeck University said: "The financial support available to part-time students does not promote widening participation and fair access, and is in stark contrast to the much more generous comprehensive funds available for full-timers."
However, if you are a mature student, planning to start a course in the near future and this research does not put you off, what options are available to you?
Here's a lowdown of the financial assistance that is available to you, and who qualifies.
Grants
Once you make a decision to start studying – whether full or part-time – it's a good idea to find out what's available to you financially through your college or university or from the state.
Full-time students may be able to receive maintenance grants or special support grants as well as college or university bursaries if they are from low income households.
If you are over 25 or have children you will be classed as "independent" and therefore your household income will be your own, as opposed to your parents' or guardians'.
Those with either children or other adults who rely on them financially are eligible for extra help.
For those with children under 15 (under 17 if they have special needs) this help is available through the Childcare Grant. This provides funding for up to 85 per cent of childcare costs both in term time and holidays. Money is also available through the Parents' Learning Allowance.
And you may also be able to claim child tax credit. If you have another adult dependent on you, the Adult' Dependants' grant is also available.
If things get really tough, the Access to Learning Fund is available, through your college or university, to provide additional financial support.
All these grants are subject to assessment and you will need to provide proof of your financial commitments, childcare fees and other details.
If you are studying part-time you could qualify for the Fee Grant, which helps with tuition fees, and the Course Grant, which provides money to pay for study costs such as books.
You are more likely to receive the maximum grant if you are on benefits, otherwise it will depend on your personal circumstances and household income.
Benefits
Single parents, families where both parents are studying and are responsible for a child, and people with disabilities may receive help in the form of income support, housing benefit or council tax benefit if they are planning to undertake full-time education.
Part-time students may also be eligible. However any grants, loans or bursaries you receive will be taken into consideration as income and therefore could mean you may not be eligible for benefits or will reduce the amount of benefits you are entitled to.
Loans
So, what if you do not qualify for grants or benefits? If you don't have savings or a partner who earns enough to support you through your education, it will be highly likely you'll need to take out some kind of loan.
Student loans are the most common. These are issued by the Student Loans Company to those studying full time. You can apply for a non-income assessed tuition fee loan or a maintenance loan to pay for tuition fees and the cost of living respectively.
The interest rates on these loans are linked to inflation, so lower than your average loan. And you do not have to start repaying the loan until you begin earning £15,000 or more before tax.
If you are studying for a vocational course or postgraduate qualification Professional or Career Development Loans (PCDLs) are available.
You can borrow between £300 and £10,000 and the government pays the interest while you are studying.
The government also subsidises the interest, so once you start paying it yourself the cost is still lower than your average commercial loan, but higher than a Student Loan.
You must also be aware that, unlike the student loan, the repayments begin the moment your course finishes regardless of the fact your salary may be low or even non-existent.
Currently Barclays and the Co-operative Bank provide PCDLs.
There are also loans available, without the government support, through high street banks for students. These are in limited supply and are usually only for those studying law, medicine or dentistry.
If you fall on really hard times universities and colleges can provide 'hardship loans' which can be paid back without interest. These are for emergencies, for example if your student grants or loans are delayed.
Ben Whittaker, vice president of welfare for the National Union of Students (NUS) said loans and credit were a fact of life for students but it was essential they assessed the different options.
He added: "Last year, we saw students being targeted by short-term lenders when student loan payments were delayed.
"Some took on more debt than they intended, and got into trouble – we want to help avoid that happening."
The NUS has teamed up with the money education charity Credit Action to produce a leaflet on credit for students, which is available from the Credit Action and NUS websites. It provides more advice on loans and credit available.
Overdrafts and credit cards
If you are about to start studying, there are bank accounts available specifically for you, with tailor-made student benefits which include overdrafts and credit cards.
Banks providing student accounts usually flag up their exciting freebies as the jewel in their crown.
But the advice is to ignore the temptations of cinema tickets, mobile phone vouchers and high street store discounts and instead look at the overdraft.
Kevin Bray, banking insight analyst for independent research company Defaqto, said students should be looking for the amount of interest-free overdraft available and the duration.
Accounts which provide a facility to alert you via text if you are nearing your overdraft limit are also very handy to avoid landing yourself a penalty.
As for credit cards, the advice is to avoid them at all costs. If you have no choice, go for one which at least gives you something back.
Craig Gedey of the Debt Advisory Line said: "A rewards credit card is a good way to pay tuition fees if the University allows. This should definitely be paid off to avoid interest charges. You can earn up to one per cent of your tuition cost in reward points.
Other tips
Mr Gedey offered some additional money saving tips to help students to ease their financial woes.
He urges students to use discount cards, such as the NUS Extra card, which costs £10 but can provide five per cent in savings on books though Amazon as well as reductions in insurance from Endsleigh, as well as high street shops.
"Use specialist suppliers for kit," he added. "For example, for second-hand computers try studentcomputers.co.uk, and for discounted software see software4students.co.uk."
Buying used textbooks can also create great savings, and these can also be bought and sold privately, bypassing any used-bookstore fees, Mr Gedey said.
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