Lloyds Bank Commercial Banking

Lloyds Bank Commercial Banking

October 03, 2013 07:01 ET

Student Finance Report: Students Struggling to Make Ends Meet Rises as Cost of University Increases

- 18% of full time students surveyed do not have enough money to get through the month and a further 48% are only just managing their finances

- Over half of students believe they will leave university with debt of over GBP 10,000

- Over half of students have taken on paid work, however, 29% of those who worked during term time say it is having a negative impact on their studies

- 44% of students are concerned about the debt they are taking on

- Students estimate their debt to be GBP 16,909 when leaving university

LONDON, ENGLAND--(Marketwired - Oct. 3, 2013) - A year on since university tuition fees came into effect in September 2012, Lloyds Bank's third annual Student Finance Report reveals that an increasing number of students are continuing to struggle to make ends meet.

Nearing one in five (18%) students surveyed say they do not have enough money to meet monthly outgoings, compared to around one in six (16%) last year. Nearly half of students (48%) admit they are only just managing their finances but money is tight.

With many of students' annual income derived from student loans, over half (56%) think they will be in debt of over £10,000 on completion of their course, with the average estimated debt at £16,909. This is a dramatic contrast with the £27,796 estimate by first year undergraduates - a clear sign that the rise in tuition fees is having a significant impact on students. Is it of little surprise, therefore, that over half of first year undergraduates (55%), were worried about the levels of debt they were taking on due to their present degree.

Furthermore, 40% of first year undergraduates said that the cost of increased tuition fees this year was a factor in their decision about which university to study at, with 11% identifying it as a key factor.

With money tight, over half of all students have turned to paid work to supplement their income. 51% of students surveyed have had a full or part time job within the last academic year, compared to 48% the previous year. Of these, nearly half (43%) said they found employment to support themselves through university and help make ends meet, this rises significantly amongst first year undergraduates to 52%. A much smaller 16% cited experience in the job market and CV building as their primary motivation, an increase from the previous year at 14%.

Considerably fewer students (69%) worked during term time for less than 15 hours per week. This compares to three quarters of students last year (75%), yet average earnings have increased slightly to £8.18 in comparison with £7.89 in 2011 and £8.12 in 2012.

Seeking employment to supplement income is having an adverse effect on an increasing larger proportion of students with 29% of those who worked during term time admitting that it has affected their studies in a negative way, compared with 25% in 2012. A strikingly smaller proportion of (37%) of students who worked during term time found that they had the right balance between study, work and being able to socialise, compared to the previous two years (44% in 2011 and 43% in 2012).

Philip Robinson, director of current accounts at Lloyds Bank, says:

"Following the rise in tuition fees, our research shows that the majority of students are expecting to leave university with a high level of debt, with most expecting to see this extend well into five figures.

"Increasing debt has seen many students take on paid work, however, despite their best efforts, students are still struggling to make ends meet. Our goal at Lloyds Bank is that our student account helps ease the financial burden of university. The account offers an interest and fee-free planned overdraft of up to £1,500, as well as money management tools to make it easier for students to stay on top of their finances and help them save money for the future."

Notes to editors:

All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 2000 adults in full time education at university during the 2011/12 academic year. Fieldwork was undertaken between 19th July and 1st August 2012. The survey was carried out online.

The Lloyds TSB student current account offers:

- A tiered interest and fee-free Planned Overdraft of up to £1,500 in the first three years and up to £2,000 in years four to six (subject to application and approval)

- An NUS extra card for three years, giving students access to exclusive discounts, offers and competitions from over 150 of their favourite brands and retailers on the high street and online, including Amazon, Spotify, Apple, McDonalds, Pizza Hut, Odeon, JJB Sports, CrossCountry trains, National Express coach journeys, Virgin Media, TopShop, ASOS, New Look, Warehouse, Alton Towers plus many more

- Exclusive £75 discount off a holiday booking with STA Travel, the world's leading travel agent for students and young people.

We also offer all customers a variety of different tools to help them stay on top of their finances and provide guidance on budgeting:

- Mobile Banking with free text alerts, including limit alerts, high/low balance alerts, overseas transaction alerts and weekly balance alertsi

- Money Manager - access to the online service which provides customers with the ability to view and track their spending patternsii

- Internet and telephone banking to help students manage their money 24 hours a day

- Advice and guidance on budgeting and managing money on our Savvy Student site.

i Lloyds TSB does not charge for Mobile Banking but mobile operators may charge for some services.

ii Customers need to be registered for Lloyds TSB Internet Banking to access Money Manager and Mobile Banking.

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