Student loan alternatives?

jodyapple

Hi All

I got myself in to a mess financially when I left uni three years ago and I really want my sister to be more savvy when she goes in September.

i am unsure if the student loan is the best way to pay for fee's etc and woudl be greatful of any advice on alternitive funding. My student loan has built up so much interest since I left it makes me feel ill. I pay back less than the interest every month and don't want the same thing hanging over her head when she leaves.

any advice and tips would be most appreciated.

X Jody and katie

Stevenj214

The obvious alternative would be paying for the fees out of saving, however his is probably not an option.

Part time job, working upto 16hours a week would bring in upto £4200pa at minimum wage.

Applying for scholarships could also bring in an extra £1000 a year if successful.

Sillychuckie

jodyapple wrote:

I pay back less than the interest every month

If you pay less back each month than the interest added on each month, you will never pay the loan back.
Are you sure that is right?

Could you afford to pay off a bigger lump sum and try to clear it earlier?

lellie

Student Loan interest rates are low. Supposedly lower than inflation..

I wouldn't recommend working 16 hours a week - most universities say maximum of 15, my course recommends maximum 10 and it's a complete doss..

Stevenj214

lellie wrote:

Student Loan interest rates are low. Supposedly lower than inflation..

I wouldn't recommend working 16 hours a week - most universities say maximum of 15, my course recommends maximum 10 and it's a complete doss..

16 hours = 9-5 Sat and Sun
16 hours = 3 evenings in a bar

Not exactly much in he grand scheme of things.

Even just working fulltime over the summer at minimum wage would bring in £3000

sophlowe45

I would still say student loan - it all depends on personal circumstances though - some people have parents who help them out, others don't so you have to take out a student loan.

Starting uni this Sept = £3000 a year fees.

What are her uni's arrangements for students? My uni will have a scheme of scholarships, bursaries and work programmes to assist students with funding (its actually really generous). If your parents income is less than £17,500 you get a minimum of £2000 and a maximum of £3000.

I have not looked into how the new system works as i'm graduating this summer, so i think it would be best to look at costs, how much her loan will be, shortfalls, funding from her uni, there are also government bursaries for people from low income families.

Then part-time work and work over the holidays...

edited to add - looking online - government will pay upto £2700 of tuition fees for students...then theres the normal loan for living expenses...so if she can some funding from her uni - she'd be sorted.

garethl_2

ALways look out for grants and funding outside the "normal" scope. I got a grant of £1000 a year from an old institution. I also got hardship money £500. I had sponsorship too for my final year from a company I took a year out with £1600. There's extra money available whilst in Uni. As for the tuition fees... I'd hate to be in the situation students are placed in now. I was lucky and went to Uni the year before grants were abolished. I don't think there's much way around taking a student loan. Other than saving up each year to pay this. Saying that most people think students have loads of spare time on their hands. My course entailed a 9 til 5 work schedule most days at the Uni building, and then many hours of coursework and write-ups in the evening. Virtually no time to be working a part time job. This is of course very much dependant on the course type. Some courses do allow plenty of "reading" time, so there's scope for some part time work. But Part time work isn't always easy to come by. I'd say try to save up while at Uni by working part time if possible. And work as many hours leading up to the start of Uni if you can. But while at Uni definitely keep a look out for funding from sources other than Student Loans Co et al. It is there and has to be used up! All the best.

jr666

fees may be £3000 a year but you don't pay a penny of that until you graduate.

Crispy_Ambulance

Most other sources of funding will expect you to have taken out the funding available to you before they will give you anything else, i.e. the student loan.

garethl_2

jr666 wrote:

fees may be £3000 a year but you don't pay a penny of that until you graduate.

I think the point the first poster is making is she doesn't want to see her sister coming out of Uni with these debts hanging over her. So she could get funding through the many options and either pay off the loans as the income is received, or put it in a high interest savings account and get the interest (that's if she can trust herself not to spend it!!!). And then pay the loan off in a big lump. Basically it's some way of not leaving Uni with any debts... a tough task these days.

kar

Most other sources of finance will not give you a penny if you haven't taken out the student loan. Quite frankly everyone has one unless she marries someone rich before she starts uni shes not really got a lot of options.

It's not the interest rate with student loans that's the problem it's the rate at which they take money back (i.e £30 a month when the interest rate gives £40 interest).