29 Aug Jonathan Cartu Review: Student finance: everything you need to be ready for
So you’ve made it through the coronavirus crisis (so far), you’ve survived the chaotic U-turn on A-level grades and the mad scramble for university places, and you’ve ruled out deferring for a year.
You have secured a place for this autumn and you are going to uni.
After navigating that assault course, some of the other stuff – such as sorting out your student finance – should be a doddle.
Well, OK, maybe not a doddle – there are clearly a lot of extra challenges and issues to consider this year because of the pandemic, and it is a fast-moving situation. Some universities have been in turmoil, with all of them preoccupied with how to best ensure the welfare of students and staff.
And then there’s the question of what is going to await students when they get there. How is the teaching and learning going to be delivered? What if you want to study remotely at first? What does all that mean for accommodation – is there going to be some flexibility? Can you even definitely afford to go to university, given that part-time work will probably be hard to come by for the foreseeable future, and many families have seen their finances take a heavy hit as a result of coronavirus? And what about freshers’ week – will it all be online?
We can’t answer every single query that people will have, but we can provide lots of information, tips and advice to help you get “university-ready” and avoid some of the potential coronavirus-related pitfalls.
How much will I spend?
Students at Oxford and Newcastle are the biggest spenders on booze, while those in Bristol typically spend the most on groceries. Meanwhile, 2020’s most affordable city for students overall is Manchester.
These are just some of the findings of a NatWest survey of more than 2,800 UK university students carried out in June this year.
They were asked how much they spend each month on average on a range of items. Excluding rent, supermarket food shopping, toiletries and household items was the biggie at a typical £81, while going out (gigs, theatre, cinema, clubs etc) and eating out (takeaways, coffees, restaurant meals and so on) both came in at an average of £33 each.
The figure for alcohol, which includes both booze drunk at home and while out, was £29 a month.
Students also said they spent an average of £23 a month on utility bills; £26 on day-to-day travel; £15 on books, course materials, printing and library costs etc; £32 on clothes, shoes and accessories; £12 on mobile phone bills and related costs; and £11 on self-care and wellbeing (gym, beauty treatments etc).
However, there were some big regional variations. On alcohol, the monthly spend figures in Oxford and Newcastle were £45 and £40 respectively – well above the £18 for London and Leicester.
Similarly, the amount you could expect to pay for a pint in your university city ranged from £2.80 in Durham and £2.90 in Swansea to £4.50 in London and £5 in Cambridge.
There is, of course, no one-size-fits-all answer for how much money students will spend each month – the costs vary greatly depending on where you are going. Also, while some students will have cash to splash, others will be watching every penny.
Your living costs could well be slightly higher during the first term because of books and equipment you need to buy, items you have forgotten to bring, and paying for any in-person freshers’ week events that are allowed to happen.
Wait until you arrive at your halls of residence or student house before splashing out. Assess what is already there. For example, Wilko is offering savings on a range of student kitchen essentials until 6 October, such as a Russell Hobbs Textures kettle and toaster reduced from £20 to £15 each.
If you are heading to the London School of Economics, how about a room in its High Holborn Residence, a self-catered hall located just minutes from Covent Garden and Soho? It sounds nice, but for a single room (albeit with a queen-size bed) the weekly rent is £304 – which adds up to more than £11,800 for a 39-week tenancy. And for that, you don’t even get your own bathroom – you have to share.
At the other end of the spectrum, the universities of Wolverhampton and Wrexham Glyndŵr both have halls of residence rooms starting from £90 a week.
According to money advice website Save the Student’s most recent national survey, the average paid for university-owned accommodation is £142 a week. But, as can be seen from the above examples, that figure disguises wide variations.
Most students opt to stay in university accommodation during their first year. And some have a dizzying array of options – basic to luxury, self-catered/part-catered/fully catered, centrally located or miles out of town, and so on. Some people will have known for ages where they are going and will have already chosen a room, while others are still working through their options.
This year there are a whole load of extra issues in the mix because of the pandemic. Earlier this year there was anger over the fact that some existing students in lockdown at home were being forced to pay for unused accommodation. So those planning to live in a university-owned hall of residence or privately run student accommodation, should check the small print very carefully and make sure they are clear about their rights and responsibilities, and whether there is any flexibility if Covid-19 continues to cause havoc.
Some universities have made changes – for example, Coventry has amended its accommodation agreement so students will be able to surrender their so-called “licence to occupy”, and the financial commitment that goes with it, if the campus has to close for 21 consecutive days or more.
Covid-19 has meant other changes, too. Wolverhampton is among the universities allocating halls of residence rooms based on the campus where the student’s course is taking place, in order to reduce the amount of travelling between sites.
How you pay, and when, tends to vary. Many universities require an upfront payment, but at others you don’t need to pay any fees until after you’ve moved in. Paying for your accommodation in three instalments – typically in September/October, January and April – is fairly standard, though some universities will accept a monthly direct debit.
Choosing the right account
It’s not compulsory to have a student bank account, but they offer features you usually can’t get elsewhere.
When you apply, you’ll be asked to provide proof of your student status. This could be a letter of acceptance from your university, though some banks will ask for your Ucas “status codes” (usually sent out via email).
For many, the key feature of a student bank account – far outweighing any freebies – will be the size of the interest-free overdraft on offer.
Halifax and Santander offer students a £1,500 interest-free overdraft from the outset of year one, which is generous, says Rachel Springall at Moneyfacts.co.uk. The Halifax overdraft deal is up to £1,500 for the length of your course, plus an extra year after you graduate, up to a maximum of six years. Santander’s is £1,500 in years one, two and three, £1,800 in year four, and £2,000 if you stay on to year five.
There are often conditions – for example, with Santander, when you open your account you’ll get an overdraft limit of £250, and to increase this to £1,500 you’ll need to pay in £500 and continue to pay in at least £500 per academic term.
Santander also offers a pretty decent perk: a free four-year 16-25 Railcard, saving students up to a third on most rail fares.
HSBC starts people off with a guaranteed interest-free limit of £1,000 in the first year. You can then request a limit of up to £2,000 in year two and £3,000 in year…