Students reliant on Government to fund studies

New research from Halifax reveals that the percentage of students relying on the Government to fund their studies has increased in the last year.

When asked how they funded their studies, food and lodging, almost three in every five students surveyed (59%) said they would be receiving some kind of government financial aid. This is up from 49% in the previous year.

As part of the same research Halifax also asked students if they had a term-time or holiday job to help fund their studies. Results showed that almost three-quarters (73%) had a holiday job and almost half (46%) had a part-time term-time job.

Borrowing to fund university

A student loan was still the most commonly held form of borrowing with 84% of students reporting they had one. This was closely followed by an overdraft (67%) and a credit card (36%).

The percentage of students with a loan varied dramatically by university region, with those attending university in Northern Ireland most likely to take a student loan (95%). This fell to 69% for those attending university in Scotland.

Students in their third year of study reported a total average student loan of £7,324, compared to £4,107 for those in their first year of study.

The average total debt for students in their third year of study was reported to be £14,225, compared to £5,499 for those in their first year of study.

Mike Regnier, current account director for Halifax, said: "Unfortunately, our research shows that for most students borrowing is necessary to fund university. However, some careful financial planning can help reduce both the level and the cost of this debt. Setting a budget and sticking to it is essential. Making sure you keep the cost of any debt to a minimum is also a must. This may include choosing a bank account with a generous interest free overdraft."

The Halifax Student Current Account offers an overdraft of up to £3,000 interest-free.