Student Finance
Student Finance is a governmental institution that provides financial support to British citizens, European citizens (holding Pre-settled or Settled Status), and citizens from other countries (who have the necessary documents to study in the UK).
When applying for Student Finance, it’s crucial that your documents are accurately completed and reflect the truth. Any mistakes in your application can delay the funding process, and you, as a student, might receive your first installment of the Maintenance Loan later or even receive a smaller initial payment.
Important notes:
- Child Grant (funds for raising children) is currently non-repayable.
- However, Tuition Fees (university fees) and Maintenance Loans (living costs) must be repaid over a period of up to 30 years.
This loan is offered under very advantageous terms: after completing your undergraduate studies, you’ll pay back 9% of your gross income, but only if your income exceeds a certain threshold. Importantly, this 9% applies only to the amount above the threshold, not your entire income. Let me explain with an example:
- The current repayment threshold for Plan 2 loans is £27,295.
- If your annual income exceeds this amount, you’ll start repaying a monthly sum calculated as follows:
- Assume your annual income is £30,000.
- Subtract the threshold: £30,000 – £27,295 = £2,705.
- Calculate 9% of this amount: £243.45 per year.
- Divide this by 12 months: £23 per month, including interest.
Essentially, this repayment is the cost of a pack of cigarettes per month.
If you’d like to see the numbers for yourself, you can test the Student Finance Loan Calculator:
https://www.student-loan-calculator.co.uk/