Can I afford to go to university in 2012? [See Power Point notes pages for more detail] 1

Tripling fees doesn't always mean tripling your costs ● In 2012 all institutions will be allowed to charge up to £6,000 ● Many will charge up to £9,000 providing they make extra provisions for bursaries for poorer students

You don't need cash to go to university ● Tuition fees will be paid automatically for you ● No repayments until April after graduation 3

Earn under £21,000 and never repay ● Repaid through the income tax system ● Repay 9% of everything you earn annually above £21,000 ● £21,000 threshold rises in line with average earnings 4

30 year cut off for repayments ● Pay no more after 30 years have passed ● Regardless of what you still owe 5

Above inflation interest will be charged ● During study - RPI +3% ● Earning less than £21,000 - RPI + inflation ● Earning between £21,000 and £41,000 – interest rate gradually rises from RPI + inflation, up to maximum of RPI +3% ● Earn over £41,000 – RPI +3% 6

● Current – 9% of earnings over £15,000 ● New – threshold £21,000, meaning lower repayments ● The following table will help to illustrate this 7 Repayments £540 a year lower than now

Continued 8

You will owe for longer, and may pay a lot more ● Cost is spread over much longer period ● Initially graduates have more in their pocket ● Though later it's likely you'll have less as you'll still be repaying 9

Part time students ● Fees of up to £4,750 (6,750 with bursaries) ● No longer need to pay up front – eligible for SLC loans ● No Maintenance Loans/grants ● Criteria: first degree, studying 25%+ of full-time course 10

Monthly repayments the same ● Repay the same each month, whether £6,000 or £9,000 tuition fees & whether you take out the full maintenance loan or not ● Important implications to how much you'll repay in total 11

Loans also cover living costs ● Students can also take out maintenance loans ● Pay for living costs – food, books, accommodation, travel ● Usually 3 termly installments straight to your bank account 12

How much? ● Amount of maintenance loan is assessed by your household income (“means-tested”) and whether you decide to live at home or away from home ● All students are guaranteed up to 65% of total available ● The remaining 35% is means tested 13

Maintenance grants ● If the household income is below £25,000, the student gets the full grant of £3,250 ● Between £25,000 and £42,600, the grant is on a sliding scale ● Grants do not have to be paid back 14

Student loans DO NOT go on credit files ● Loan, credit card and mortgage providers only know you have a student loan if they choose to ask ● Impact on ability to get a mortgage in the future is limited

You may not be allowed to repay early ● May be penalised for repaying your student loan back early, especially as real interest is now being charged

Many people will never pay it all back ● It is estimated only 40% will ever pay back the full amount and these will only be the very top earners ● Likely many will repay the same on a 6,000 course as a 9,000 17

Think of it like a tax not a loan Why? ● Repaid through the income tax system ● Only repay if you earn over a certain amount ● Amount repaid increases with earnings ● Does not go on credit files ● Debt collectors will not chase it ● Bigger borrowing doesn't increase repayments ● Many will repay for the majority of their working lives 18

Financial support available (The following may be available as well as a maintenance grant) Fee waiver – a reduction of tuition fees Bursary – cash/gift in kind (grant/scholarship/living costs) Scholarship – like bursary, often depends on academic abil ity 19

Any questions? 20

Useful links