Student Finance Parents' Guide – Part 1: Savings and Budgeting

Students taking their A-Levels will soon be celebrating the end of their exams and planning their next adventure into the world of university education.

However, often behind every eager student is an over-stressed, under-informed and financially fearful parent or guardian. Having your child leave for university can be a stressful time.

Concerns surrounding their safety, their commitment to study and their financial stability can leave even the most relaxed of us riled.

Whilst there is an abundance of advice for students, advice for parents of students going to university is sparse.

We’ve put together a two-part guide, this being the first part.

Read on for advice on how you can ensure your child has a happy and financially healthy time during their time at university – there are lots of useful links included so make sure you hover over the text!

Understanding Student Finance

Working through the reams of information on student finance can feel like navigating through a money minefield.

Rules and criteria differ depending on where your child is studying/residing and which year they started at University.

Consumer Watchdog Which? provides a useful guide on student finance which is located here.  

No matter where your child is studying, there is one question all parents or guardians face: should we give our child money? Legally, you are under no obligation to support your child financially through university. However, this is heavily at odds with the way current student finance works.

Student finance now operates under updated plans depending on when a student started university. For those starting from 2025 in England, Plan 5 applies, meaning a longer repayment term and a lower salary threshold before repayments begin.

The more you earn within your household, the less your child is likely to receive in maintenance loans. Save the Student has a useful parent contribution calculator based on current student loan rules and cost of living estimates.

Of course, individual circumstances vary, and no parent should feel forced into debt or hardship.

If you don’t feel able to contribute financially each month, why not offer to pay for items such as their mobile phone contract, streaming subscriptions, online grocery or student travel card? This can ease your child’s financial worries and offer peace of mind.

Budget Budget Budget

Even the savviest of students can be surprised by the hidden costs of daily life. Before they leave, sit down and talk them through budgeting.

Making them face the costs of things such as rent, utility bills, food, travel, and ‘fun’ money upfront will help prevent any nasty surprises.

We’ve included some handy calculators below:

Ucas Student budget calculator

Which? Student Budgeting Tool

Money Saving Expert Budgeting tools and tips

Budgeting habits learned now can last a lifetime. Modern banking apps like Monzo, Starling, and Revolut offer built-in budgeting features, spending insights, and savings pots which can make it easier to budget.

Hidden Costs

As well as the big hitters such as rent, bills and food, there are a number of hidden costs students face. Make sure your child is aware of:

TV Licence

If your child watches or records live TV or uses BBC iPlayer, they legally need a TV Licence. Most on-demand platforms don’t require one, so many students opt out. It’s a common misconception that one license will cover everyone in halls of residence. This is not the case. For more information visit the TV Licensing website.

Remember, you can always apply for a TV license refund if you haven’t used the full 12 months.

Contents Insurance

With up to 1 in 3 students being victims of burglaries, having contents insurance is a necessary but often overlooked financial outlay. Modern students take a plethora of expensive goods with them to university so ensuring they are insured and registered makes sense. Howden Insurance provides a range cover options for students. It’s also worth checking with your child’s bank as many will offer cover packages alongside student accounts.

Internet

If your child is residing in student accommodation, their internet will be included. For those in shared accommodation, it is unlikely that Internet will be included in their monthly rental agreement. When choosing broadband packages, concerns such as the number of users, how heavy data usage will be and how the bill will be split all need to be considered. It’s always worth using price comparison websites to shop around and there may also be the option of cashback or a student discount.

Travel

Railcards, bus passes, and student travel cards can significantly reduce travel costs. Make sure your check cards are valid for travel during peak hours. You can also use your Tesco Clubcard points to buy Rail Cards and some banks offer a free railcard as an incentive for setting up a student bank account.

Council Tax

Students are exempt from Council Tax in full-student households. If living with non-students, only those non-students are liable. Students can get a certificate of exemption from their university. If your child lives at home, you may qualify for a 25% discount.

Support Funds and Bursaries

Don’t forget to check what extra support might be available. Many universities offer bursaries, scholarships, and hardship funds. A quick call or visit to the university’s finance office can make all the difference.

We hope you’ve found this useful. Please share with friends and family to make this exciting (and nerve-wracking) time a little less stressful.

Join us for part two where we look at how you can help your child make money while studying.