Rising living costs could lead to increase in student debts

By Joel Stanier

Poorer students who don't receive financial assistance from their parents must now work 33 hours a week, on average, to avoid a cash shortfall during their studies.

The research by the NUS (National Union of Students) may suggest that some students could be forced to take on additional debt on top of their regular student loans to get by.

The NUS said these poorer students face a cash shortfall of £8,566 a year on average - and called for more help for students from "disadvantaged" backgrounds.

Pete Mercer, NUS vice-president for welfare, said: "The government has not acknowledged the steep rise in living costs we've experienced in recent years. Accommodation costs, for example, have doubled in the last decade. And, aside from tuition fees, which have now tripled at many universities, students are also expected to pay out for extra academic expenses."

The report comes shortly after the government gave universities the go-ahead to increase tuition fees - with many students now required to pay £9,000 a year for their studies. This is all covered by government student loans, but it means many students are left with debts in the region of £30,000 or more once living costs have also been considered.

However, students who began their studies in 2021 or later will only start repaying their loans once they start earning above £21,000 (compared with £15,000 before 2021), with 9% of any earnings above that amount going towards loan repayments.

But any additional personal debts taken on during their studies - such as credit cards, loans and overdrafts - must be repaid during or shortly after their time at university, which can cause problems.

An expert at All About Money said: "Student debt repayments are designed so that they should never be a significant burden on your month-to-month finances. But anyone struggling to repay other debts from their studies, such as student overdrafts that now charge interest, should find out what help is available to them."

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