How are students making ends meet?
For many heading to university or returning for their second/third year of study, finance often emerges as one of the key areas that students struggle with.
We know that there is so much for students to consider when it comes to finance and we don’t just mean managing their application with the Student Loans Company (SLC). There’s a lot more to think about including asking family for financial support, figuring out if part-time work is manageable during your studies, sorting out a budget, trying to understand your credit score and securing alternative sources of finance if government funding is not enough.
That’s why we wanted to know more about the things that are really on student’s minds and the realities of the expenses facing them day to day.
Is government funding enough?
Seeing as 87% of the students we surveyed¹ have a government-funded loan, this financial resource should be supporting students with the bulk of their financial needs while in-study. But unfortunately, the reality for a significant portion of students is that these government loans are simply not enough.
For 63% of UK students, getting to university and completing their degree also means figuring out alternative sources of finance to fund their studies.
So how are students making ends meet?
There are options when it comes to extra finance for students who are not fully covered by their government loan (or not eligible for government funding at all).
The most common source of extra support is seeking help from family. After turning to parents, students are looking into established credit options such as a 0% bank overdraft or a student credit card.
Students also consider looking for part-time work if they can manage it alongside their studies and also investigate their options to qualify for grants, scholarships and bursaries. A number of students are turning to private student loans which are now supporting 3% of university attendees to complete their studies.
When it comes to figuring out the best financial option for them, parents and family members still top the list when it comes to seeking advice. Students, who in many cases are entering the world of personal finance for the first time, seek assurance from people they know and trust when it comes to managing money.
Other places where financial advice is often sought is directly with their university and many students are also taking the reigns themselves and turning to the internet to understand all of the options available to them.
How do students manage once at university?
For many, the reality of their financial needs might not be fully realised until months or even years into their degree.
While 15% of students felt the pinch in first year, it was the later years that seemed to cause the most concern with 32% struggling in their third year. A significant 21% of the students we surveyed struggled with their uni costs every single year of their study.
What are students spending money on?
Not surprisingly, it is all of the necessities that take up the chunk of student expenses, with accommodation topping the poll as the most significant monthly outgoing.
Transportation, groceries, utilities and resources for their course also take up a hefty chunk of student costs while 64% said that food, groceries and eating out was the most significant daily expense.
So are students financially prepared for uni?
For many people in the UK, getting to grips your credit rating seems to be at the top of the list when it comes to understanding and organising your personal finances. This is significant when you then consider that 76% of students don’t know what their credit rating is or are unsure of it.
And this is not to suggest that students don’t care about their finances as 25% know their score and a 33% chunk want to know what their score is. If you are one of these students, why not check out ClearScore’s helpful guide to learn more about what a credit rating is, why it’s important and how to check it.
While there can be uncertainty around particular areas, students do feel prepared when it comes to the day to day activities of living away from home while at uni.
81% feel confident when it comes to making their own meals and 78% are able to tackle their laundry. And with the increasing number of resources available to them when it comes to financial literacy, 59% of those surveyed feel capable of budgeting and managing their finances while studying.
The reality for students is that they are being thrust into the world of finance without much choice whether it’s understanding how SLC works or just figuring out how to make a monthly budget. What’s most important is that students want to be in control of their finances and are looking for transparent information and support around all of their options and the essentials to managing finance.
1 Future Finance Online Survey, July 2019, 1,930 students surveyed.