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Worrying misconceptions about student finance
60% of prospective students have ‘worrying misconception’ about student finance
Student Finance Day is launched as new research shows dangerous knowledge gaps
As students face the prospect of £9,000 English tuition fees for the first time, while others visit Open Days for 2013 entry, new research released to mark the second annual Student Finance Day shows a high level of confusion over the new student finance system remains.
- Students wrongly worry about repaying when not earning. The research found 63% of English 14-18 year olds and 60% of those starting university in 2012 are worried about how they’ll repay the loan if they are unemployed or a low earner after university – despite attempts to publicise that repayments only come into effect after graduation and provided you earn over £21,000 – and even then it’s proportionate to earnings.
- Students wrongly worried about the impact on their credit file. Some 61% of English 14-18 year olds and 55% of the 2012 cohort are also worried about student loans going on their credit files – even though they don’t.
Perhaps unsurprisingly given these findings, as many as 65% of 14-18 year olds and even 33% of those starting university this autumn admit they still don’t think they understand enough about the new student finance system; with 59% of those starting university imminently and 74% of those aged 14-18 wanting more information about the system and how it might affect them.
The impact of this is that 61% of 14-18 year olds admitted that the changes had made them think harder about whether to go to university, and 91% felt that if they did, they would need to work whilst at university to financially support themselves.
Head of the Independent Taskforce on Student Finance Information (who co-ordinate Student Finance Day), Martin Lewis of MoneySavingExpert.com said:
“The tragedy is, it’s likely a good chunk of potential students are choosing not to go to university due to misplaced fear. Worse is, I suspect it’s those from non-traditional university families who are most risk averse and most affected.
“Part of the problem is there’s too much focus on the headline amount being borrowed - a mostly irrelevant figure. What really counts is how much needs repaying and that depends solely on what’s earned after university. You repay nothing under £21,000 and above that, the more you earn, the more you repay. Financially at least, it is effectively a no-win, no fee system.
“Whether you support the changes or not, we must ensure that we don’t damage a generation of students through misunderstandings. That’s why initiatives such as Student Finance Day are so important. Universities, schools, colleges, parents, politicians, and the media all need to come together to ensure we communicate the financial facts – not the fiction. After all, if young people don’t understand the true cost, how can they make an effective decision?”
The results of the survey come as universities, schools and colleges across the country join together for Student Finance Day (20 September), hosting events and disseminating information to help prospective students and their parents get clear and accessible information on student finance.
For more information on student funding visit www.nasma.org.uk/students/
Notes to editors
- All figures, unless otherwise stated, are from ResearchBods. Total sample size was 1,300, of which 800 are 14-18 year old students currently in school or college and 500 are starting university in Autumn 2012. All respondents were based in England. Fieldwork was undertaken between 7 and 11 of September 2011. The survey was carried out online.
- The Independent Taskforce on Student Finance Information is independent of government. Its operations group includes the NUS, the Association of School and College Leaders, Universities UK, UCAS and the National Association of Student Money Advisers. The first Student Finance Day was held in November 2011. For more information on Student Finance Day, visit www.studentfinance2012.com
- ResearchBods provide online polling and surveying services to companies and organisations wanting to access consumers in the UK and globally. The company has a key focus on providing access to youth, families and the education sector, and runs the largest direct to youth research panels in the UK. For more information please visit www.researchbods.com or email email@example.com.