Student finance and debt

You may be covering your living costs with:

• a maintenance loan
• money from your parents
• wages from a job
• scholarships or grants
• a combination of these

 Wherever your money’s coming from, it’s a good idea to create a budget and check it regularly.

A lot of students have to live on a very tight budget, so this is a common problem. If you’re in this position:

• consider whether you can increase your income e.g. by taking on part-time work
• identify any areas you could make cutbacks e.g. sharing meal costs with housemates
• check you’re making the most of student offers e.g. student railcard and NUS discounts
• get advice from your student union
• visit Save the Student

As an undergraduate, you may well get a student loan each year but you won’t need to pay this back until you’re earning above a certain amount.

When it comes to other forms of credit, you should only ever borrow what you need and what you can afford to pay back.

If you need to borrow while you’re studying, an overdraft on a student bank account may be one of the better options.

You won’t usually be charged to use a student overdraft. But you will have to repay everything you spend eventually.

Overdraft limits on student accounts are typically between £500 and £3,000.

Sometimes these limits are increased each academic year, either automatically or by applying to your bank.

At the end of your course, your student bank account is likely to be changed to a graduate account. This usually means your overdraft will remain interest-free for at least another year, giving you time to pay it off before charges are applied.

If you’re living in shared accommodation, make sure everyone is paying their fair share of the bills. It’s also important to make sure bills are paid on time. Late payments could damage your credit rating and make it harder to borrow in the future.

If you’ve borrowed money and are struggling to pay it back, get debt advice as soon as possible. Burying your head in the sand will only make matters worse.