Student Loan Cover – Student loans are a lifeline for many students looking to expand their knowledge and career prospects through higher education. As university fees cost around £9,250 each year, the total cost of an average degree is a sizable amount. Government-backed loans can help cover a variety of expenses, from course fees to essentials such as housing and food, allowing thousands of individuals the opportunity to focus on their studies without financial stress.

If you’re eligible for a student loan, the amount you receive depends on several factors such as where you live, how much you or your household earns, and your citizenship status. 

Here, we break down exactly what a student loan in the UK could cover.

Tuition Fees Loan

A student loan can be taken out in two parts, one covering the cost of the tuition fees and the other for your living expenses. Your tuition fee loan is paid directly to your college or university. The cost of tuition varies depending on the educational institution and course type. Your loan will only cover the cost of the course you take out, up to the current maximum as set by the government – which is £9,250.

You can be eligible for a tuition fees loan only, or both a tuition fees and maintenance loan, depending on your circumstances. Using an online calculator is the easiest way to see what you could apply for. As a general guide:

• If you’re living at home with your parents, their income will be considered when assessing your eligibility
• You must be looking to study at a registered college or university
• You’re applying for your first higher education course

If you’re highly talented, a scholarship may be available to cover your tuition fees. Or, you could look into taking out a private student loan – though these can be more expensive to repay. Degree apprenticeships are a good option for those who are keen to achieve a higher qualification whilst working, as your employer will typically pay for the fees of your education.

Maintenance Loan

A maintenance loan covers your accommodation and essentials whilst you’re studying – this is paid directly to you, usually per term. If you live on campus, your loan could cover the cost of your room. If you choose to rent privately off-campus, you could be eligible for an amount toward your rent and bills, but the limit may not cover all of the costs. You could also receive money towards meals if provided by your university.

There are no set rules on what you can use your maintenance loan for, as it’s paid directly to your bank account. Being smart with budgeting and how you use this money is the best way to make it stretch and avoid falling short when it comes to paying for the essentials.

Many students enjoy uni life in halls of residence or shared student houses around campus, and it is often far more affordable than privately renting a place on your own. But, be sure to be a respectful roommate and do your part when it comes to household chores – remember to also stay vigilant about safety and protect yourself from unsafe situations.

Consider repayments

Whilst they are a brilliant option for accessing higher education, student loans do usually have to be repaid. Repayments don’t typically begin until you start full-time employment and are paid over a certain amount, depending on the plan you are on. These figures range from £21,000 to £27,660, but you’ll only pay a percentage of your salary above this limit. For an undergraduate degree, the current rate is 9% over the threshold, whereas, for a postgraduate degree, it’s currently 6%.

This means that the more you earn, the higher your repayments are, but the scheme is designed to be affordable and avoid negatively impacting your finances in the future. Once you’re employed, your earnings and any repayments due will be tracked and taken automatically. If you’re self-employed, you’ll need to include your student loan in your self-assessment tax return each year. Student loans can be written off after a certain period, or in extreme circumstances, such as death.

Manage your money carefully

Student loans are designed to cover the costs of pursuing higher education, ensuring that financial barriers do not impede anybody’s ability to progress academically and better their lives in the UK. By helping students pay for tuition, housing, transportation and essential costs, these loans provide the necessary support for those seeking higher education opportunities. However, as with taking out any form of credit, it’s important to learn to budget and plan for your repayments wisely to avoid struggling financially in the long or short term. Therefore, here’s how you can do a student loan cover.

Disclaimer – The views expressed in this blog are those of a third party and do not reflect the views and opinions of the SecureMyScholarship team.