We need more university student finance guidance in schools - Before and after the review
There are a number of barriers to higher education – academic ability, lack of aspiration to progress to university, student background to name three of many. But the one that comes up time and time again is student fees and finance. In our national review of university guidance in schools finance was again raised as the greatest barrier - 62% of schools stated tuition fees and living costs were the greatest reasons they thought students were not going to university.
Fees and student finance is the biggest barrier to university - but increased IAG will address it.
Every piece of research I have looked at exploring barriers to higher education raises student finance as an issue. This includes the UniTasterDays research I mentioned in the first paragraph, but also research from UCAS, NEON, The Office for Students and The Sutton Trust as well. There will be more.
UniTasterDays also did some research with The Student Room, where 600 university students were surveyed, looking back on the university information provided at their school. What did students look back and want to know more about if they had their time again? Again, student finance. It is a social injustice that students are not going to university because they think (or have been told by others) that they can’t afford it, without being introduced to IAG to support them with this first.
Many students don't understand student finance sufficiently to make informed university decisions
As well as supporting schools to find student fees and finance events, UniTasterDays also deliver independent workshops in schools. Meaning I see things first hand.
Many students, in the year’s right up to those applying to university in Year 13, do not understand the student loan repayment system they may be subject to in the future, nor do they understand the key aspects of the system. We start sessions with a simple exercise looking at student loan repayments based on future earnings to explore knowledge before the session and students rarely are anywhere even close to the answers. But after a 30 minute session they get it. These finance sessions show incredible impact. They don’t convince everyone that university is right for them – but they outline how the student fees and finance system works, and will focus on what student finance will cost the student, rather than concentrating on the debt they incur - which in many ways doesn’t matter, as daft as that may sound. Universities will run sessions like this too.
Without such student finance IAG in schools, positive news such as the student loan repayment threshold being increased to £25,000 + will not be received as positively as it could be. Just that snippet of knowledge it critical, if students don’t benefit financially from university they won’t pay their student loan back (and the interest) within 30 years. No chance.
This is not because people going to university don’t benefit financially. They do. The graduate premium (how much more a graduate earns compared to someone who doesn’t participate) is around £10,000 a year. People may disagree with me, but the stats show university is a good investment. Especially because the initial outlay will be nothing at all.
Paying it back - why most people won't..
For arguments sake, say a student finishes university with a £50,000 student debt from their tuition and living costs. They then earn say £30,000 - meaning they will be paying back £450 a year from their loan. Salaries may increase of course, but so will the £25k threshold. And interest is added too. They have 30 years to pay off the initial £50,000 balance, plus interest, and in year 1 they will have paid off £450 of it. Then interest is added on £50k at over 3%. Meaning they havent cleared anything at all. In fact, they have added to it. 29 years to go... and so on, and so on. You can see how only the high earners will clear it can't you!
Every student should understand (not just be told) about the student finance system
Now university on the face of it, is expensive. I can see where these concerns come from. Fees up to £9,250 a year, living costs on top of that. Lots of negative publicity around the cost of university. The ongoing student finance review won’t help those students applying this year either – it is another reason this is not taken as seriously as it should be. What’s the point? It will all change. The point is that many people applying (and not applying) to university this year are doing so without appropriate information being provided to them.
But it is important for students to know they key facts about student finance to make informed university decisions. The fantastic Martin Lewis wrote a piece in the UniTasterDays Teachers’ Guide to University all about it. It is a few months old now, but the key facts remain. Martin seems to be be doing more on this issue than anyone else.
Who is responsible for student finance guidance in schools?
In England, The Student Loans Company don’t have a student facing remit. They will work with universities and teachers and do a great job, but unfortunately they are not commissioned to speak directly to students.
Advice and Guidance relating to this area is therefore provided in school, or by universities, or through external independent university workshop providers like UniTasterDays. So the onus is on the school to see this as a priority, and then look for a provider to address it.
This approach may be fine if schools do not have other huge priorities. They do, and the school curriculum and the here and now will understandably be the focus of school efforts. That will mean some schools do student finance well, and others won't do it at all.
What can be done to improve student finance guidance in schools?
If you are a teacher or a career adviser – try and ensure every student receives a student finance workshop during their time with you. You may notice indirectly this would have a positive impact on aspirations and their results too. The system can (and has) changed, but the workshop should also encourage students to stay up to date with changes in the future. The fear of change and the ongoing review should not be a reason not to do anything.
As well as that, UniTasterDays will continue to campaign in this area – we’ve been outlining concerns with key players for some time, and won't stop now. Part of the solution is raising awareness of the problem... Please do therefore share this blog with colleagues and of course get in touch if we can help you book a student finance event for your school. We would be happy to help.