/ Money, Parenting

Do you know how much you’re supposed to give your kids for uni?

Books and money on shelf

Kids off to uni soon? Get ready to have your income checked as part of the student finance assessment – and then cough up any shortfall, says our guest, Martin Lewis

They’re 18, finally old enough to vote, ready to leave home and go to university – finally truly independent! Well not quite. Almost every under-25 heading for higher education has their student finances assessed by their parents’ income – not their own.

While all first-time UK undergraduates in England are eligible to get the full loan to pay their fees, the amount of loan they get for living (the maintenance loan) is dictated by their parents’ income.

Many don’t get the full amount. Parents are implicitly meant to fill the gap. Yet this fact, never mind the actual amount, is hardly touched on in any literature. All I can find is one mention buried in the Student Loan Company’s ‘How you’re assessed’ guide (pdf), which has the flaccid phrase ‘depending on their income, parents may have to contribute towards the living costs of their student children’.

This isn’t good enough. The core element that reduces the loan is parents’ income, and this should be explicit. The lack of information means many parents either don’t realise they’re officially supposed to contribute, or see it as a loose amount.

I often hear complaints from parents that ‘the living loan isn’t enough to cover their rent, never mind living costs – I have to give them extra’. This misunderstands that the design of the system factors in parents giving extra; of course students haven’t got enough.

A transparent and fair system would mean the loan letter said something like this (based on a student living in London with £70,000 combined family income):

‘Students – your loan for living is £5,330 a year, this is less than the full loan and we expect your parents to make up at least the £5,372 difference.’

I wrote to the University Minister Jo Johnson requesting that the communication be cleared up. His response was disappointing and confusing. He argued that just because the calculation is based on parents’ income, parents are not expected to make a particular contribution – students can make up the difference from savings or part-time jobs.

Of course they can, yet that answer applies to all students regardless of parental income, so actually the logical implication is all students should get a flat rate. If we don’t expect parents to make up the gap, then why judge on parental income?

I accept politicians may fear pointing out the contribution, especially as the means-tested element this academic year has jumped to up to 56% (it was just 35% in 2015), but even a less polemic statement clearing up the elements would help. Something like…

‘Students – your loan for living is £5,330 a year, which is £5,372 less than the full loan as your parents have higher income.’

As this isn’t happening, to find out how much you’re expected to contribute I’ve developed ready reckoners to help.

Yet while most students are assessed on parental income, there’s no obligation on the parents to contribute (and students can’t force them). Again, this lacks logic – the finances of students and parents should either be separate, or students should have some ability to be able to force parents to comply. The current situation is unclear and therefore unfair to both students and parents.

I’d love to hear your thoughts on this. Is your child or grandchild at university – and did you know what the government expects you to contribute. If you top up their loan, do you feel you have to, and how do you work out what to give them?

This is a guest contribution by Martin Lewis, Founder of MoneySavingExpert.com. All views expressed here are his own, not necessarily those shared by Which?

F Perry says:
19 April 2017

Our daughter finishes her A levels this year. She has been working hard and is on track to do very well indeed; I am excited for her (as is she!) and feel confident she will make the most of it. I am, however, amazed and appalled in equal measure that the maintenance loan does not even cover the rent. I totally accept we should contribute to our daughters’ education but didn’t expect that we would be obliged to pay so much; I feel that all should be eligible for at least a maintenance loan that covers the basic rent. We will be topping up the loan to cover the rent and then she has to at least eat to live (and in 3 years we’ll be doing the same again), it is going to be very expensive indeed. Many parents would not be able to manage to do this – it’s divisive and unfair.

JulieOwens says:
23 April 2017

Hi- hopefully my daughter is going to University in Sept 2017 so I am currently grappling with the student loan application. I’m divorced from my daughter’s father and my daughter currently lives mainly with me. He has refused to contribute anything despite being able to afford to contribute. I do not understand how it is fair to assess the amount of the maintenance on household income as it means some parents have all the responsibilty for the maintenance contribution.


Could I direct you to a comment near the top of this Conversation from Caroline [22 March 2017] that might be relevant to your situation, Julie?

See: https://conversation.which.co.uk/money/martin-lewis-money-saving-expert-parents-and-student-finance/#comment-1480493

Sue says:
1 May 2017

My daughter is going to uni in London to study nursing, so as parents we will have to top up her maintenance loan to the tune of £3,500 and as nursing students have to work placements on 12 hour shifts she will be unable to get a part time job to contribute.

T.Little says:
11 May 2017

One point I can’t find referred to is that there is no differentiation made between whether the parental income is from one or two parents : a household with a single parent earning for example £60,000 will have significantly less actual income than a similar household with two parents working whose total salary adds upto £60,000 due to the former paying a much higher rate of tax, surely there should be some adjustment made for nett income to account for this, even if the disposable income issue can’t be tackled in full due to differences in what might be considered essential spending by some being classed as luxuries by others..

Angela Bannister says:
14 August 2017

I really find all this mind blowing. I have got myself into debt to assist firstly with my daughter and now my son who is going in his last year. This was not for fees it was accommodation and to live , EAT, to be more precise. i can not understand why parents have to contribute to adults. Just because on paper it looks like we earn plenty , they must think that we have no outgoings. We should be able to gift our children when we feel the need not to stop them becoming homeless or starving.
Both me and my husband like many other parent have struggled to bring our children up and give them good sound advise about earning and not just expect us to bail them out, but the government appear to have a different look on this.
Both my kids have stated that they would leave and get a job if we are finding it difficult, HOW COULD WE LIVE WITH OURSELVES THEN.