THE countdown has begun to Tuesday, August 8, when exam results land on doormats across Scotland, signalling the end of that long arduous trek to join the world of academia, with confirmation of university places for thousands of teenagers.
School leavers can wave goodbye to Miss Jean Brodie and look forward to four years of fun, freedom and intellectual challenge. Student days promise a great social life, the opportunity to develop new hobbies, and study the things we are passionate about to the exclusion of all else.
But there is seldom gain without pain, and a university career comes with a hefty price tag. Students typically emerge with debts of more than 14,000.
Scottish students studying north of the Border do not have to pay tuition fees, so in theory should be better off than their southern contemporaries.
But courses tend to be four rather than three years, which means higher living bills. There is also the endowment of more than 2,000 which must be paid on graduation.
The financial screw turns hardest on Scots wishing to study in England or Wales. They must pay 3,000 in top-up fees each year, although they may be able to cut maintenance costs on a three-year course compared with four if they stay at home.
The only bargain on offer seems to be available to English and Welsh students who opt to study in Scotland. They can cut their top-up fees to 1,700 annually, unless they are studying medicine. However, this concession must be weighed against the higher costs of a four-year course. Rather than 9,000 fees in England they will pay 6,800 but will also have to foot maintenance for four rather than three years.
Unsurprisingly, the numbers of Scots applying for further education has fallen slightly, although the numbers entering Scottish institutions is rising.
And the signs are that financial worries loom large among those who are taking the plunge. Surveys show that three-quarters expect to work part-time to keep their debts in check, and one in five is planning to live with mum and dad.
However, don't panic. Before depression sets in and you are tempted to tear up your acceptance notice, it pays to study the financial help available. There are a range of grants and bursaries available as well as loans from the Student Loans Company and the banks.
Use these wisely and budget carefully. You should emerge from university, degree in hand, financially, as well as intellectually robust. We show you how.
STUDYING IN SCOTLAND
SCOTTISH university courses tend to last for four years, during which time students must feed and clothe themselves and keep a roof over their heads.
The cheapest way of doing so is to continue to live at home, which many do, although this may curtail your social life and sense of freedom.
There are no tuition fees. However, an endowment must be paid by the April after graduation. This is currently 2,216 and rises in line with inflation. Lone parents and mature or disabled students are exempt.
Nevertheless, the graduate endowment and four years' living costs will make a big hole in any young person's savings and part-time earnings. Many parents will help financially where they can, but students still need to explore other options.
A good place to begin is to investigate any bursaries or grants provided by individual institutions. These can be offered to students displaying certain academic, sporting or musical talents, or be paid to a particular kind of applicant - perhaps from a certain locality or income group.
A full list of bursaries is available on the UCAS website, which is the central organisation managing university applications. You apply direct to the university.
According to the National Union of Students, bursaries are now playing a major role in students' decision-making. A spokeswoman said: "We are seeing a big surge in the number of students who say they are applying to a particular institution because of the available bursaries."
A Young Student Bursary is available from the Student Awards Agency for Scotland for under-25s, but this is means-tested.
If your parents' joint income is below 17,940, you receive 2,455. Above that, the bursary is reduced until their earnings reach 31,775, at which point you get nothing.
The Awards Agency also has additional funds for hardship and childcare grants. However, these are limited. If you are likely to need additional support, apply early or you may well find the money has run out.
Further financial assistance comes in the form of loans, and these too are means tested. All students are entitled to a basic non-means-tested loan of 850 if you fly the family nest or 560 if you stay at home.
The most you can borrow if you live away from home is 4,300. It is 3,405 for the stop-at-homes. However, you will only get the maximum if your parents' income is below 17,200. To work out how much loan they might otherwise receive there is a useful calculator on www.student-support-saas.gov.uk
Interest is charged the minute the loan is taken out and clocks up at the prevailing rate of inflation, which from September will be 2.4%.
An urban myth among students is that you have to take out the loan even if you don't need it. The most sensible advice if you don't need to take on debt is don't. Just count yourself lucky if you can bridge the gap with a part-time job and parental help.
Another highly suspect piece of student wisdom is that even if you don't need the money it still pays to borrow it and put it in a savings account.
It is true that if you constantly chase the best rate, you might be able to make perhaps 100 or 200 over the course of your studies. But it will take great discipline to ensure you are always earning a better rate of interest than you are being charged. Furthermore, you'll need nerves of steel not to delve into it when times get tough or when you feel you owe yourself a well-deserved break in the sun.
Rather than a nice little earner, the loan will turn into yet another millstone.
Finally, the very poorest students whose parents bring in less than 17,000 can apply for a further loan of 560. This is available but gradually phased out up to a parental income of 20,225.
PAYING THE LOAN BACK
YOU do not need to repay the debt until you are at work, and earning more than 15,000. Money is then deducted from your monthly salary at the rate of 9% a year.
This does not sound onerous when you are a student. However, many find it arduous once they start work, not least because every time they receive a pay rise their student loan repayment goes up.
According to the Student Loans Company, former scholars have fallen 186m behind with their debt repayments. Most of this relates to loans taken out before 1998 when students were responsible for the repayments. After that, the money was deducted automatically from pay packets.
Although bankruptcy figures, showing a sharp rise in the numbers of 20-somethings going bust, are often attributed to student debts, in fact it is not possible to wipe out loans to the Student Loans Company this way. These debts remain payable even after others have been wiped out.
THE easiest way to apply for loans and other awards from the Student Awards Agency for Scotland, is online via its website at www.student-support-saas.gov.uk
Alternatively, you can download application forms from there.
If you prefer to have application forms posted out, you can obtain them by telephoning 0845 111 1711, e-mailing firstname.lastname@example.org or writing to The Student Awards Agency for Scotland, Gyleview House, 3 Redheughs Rigg, Edinburgh, EH12 9HH.
Applications for bursaries from individual universities must be made to the specific institutions. Details are available from the UCAS website, or websites of the colleges concerned.
Useful e-mail addresses: NUS Scotland, www.nusonline.co.uk/scotland NUS for the whole of the UK, www.nusonline.co.uk Student Awards Agency for Scotland, www.student-support-saas.gov.uk Student Loans Company, www.slc.co.uk
For free impartial advice about dealing with your debts, contact Money Advice Scotland. You can find out where the nearest office is via its website www.moneyadvicescotland.org.uk
Alternatively, Citizens Advice Scotland offers a free confidential debt advice service. It has a map with local offices on www.cas.org.uk
A LESSON IN INSURANCE
STUDENTS may be cash-poor, but many are astonishingly asset-rich. A typical student room in halls, now accommodates a computer, television, hi-fi system, DVD and video players, and other assorted electronic gadgets, as well as piles of CDs and DVDs.
Yet while insurance companies are falling over themselves to sell young people insurance for skiing and backpacking holidays or gap years, there's no danger of being crushed in the stampede to sell you contents cover.
The problem is the risk. Many universities are sited in crime-ridden city centres. Even campuses in leafy suburbs are notorious honeypots for opportunist thieves. Some students rarely even lock their doors. Anyone can walk in and help themselves.
Some universities, such as Nottingham, attempt to make students think about security by handing freshers a mug that warns there is a theft every five minutes. Only a few get the message.
So students face problems insuring their prized possessions. One piece of good news is that parents are much more in demand. Companies are competing fiercely for mainstream business by adding additional benefits to the sort of household policies parents buy. One of these developments has led a number of firms offering to provide cover for a student's belongings while they are away at university.
This is likely to be the cheapest way for students to protect their possessions, so it could prove worthwhile for parents to ask about extending their policy to include this cover when they renew.
But beware. This will only work if parents can establish that their entourage has been "temporarily" removed from their normal home. If the family home ceases to be a student's usual home because, for example, they stay away for almost the entire year, then it cannot be said that they have been temporarily removed. Check conditions thoroughly.
Also be aware, as with standalone policies, that the policy will only pay out if normal insurance rules apply. This will require doors to always be adequately locked when you are not in your room. Insurers normally only pay up with evidence of a forced entry. And don't forget parents face their premium going through the roof if their child makes a big claim.
Most thefts from student accommodation are the result of poor security. Such claims will not be met.
If cover isn't available under parents' standard household policy then a standalone contract will be required. Endsleigh has long been the student specialist and has arrangements with the NUS. But even its website, though busy with information about car and travel cover, is hardly foisting contents protection in your face. Prepare for a long search, and expect to pay between 24 and 45, depending on levels of protection, to insure 2,000 of possessions.
TIPS FOR MANAGING
• Remember: students are not eligible to pay council tax, so make sure there is no element included in your rent.
• Draw up a budget and stick to it. Once essentials such as rent, utility bills, travel and food have been allowed for, a weekly spending limit for entertainment and other non-essentials such as clothing can be worked out.
• Think about operating in cash. If you always pay by plastic - either debit or credit cards - your spending can soon run away from you. You only realise there is a problem when big bills arrive.
• Those who find that their spending is getting away from them should keep a diary to see exactly where their cash is going. Withdraw a set amount of money once a week to pay for entertainment and nights out. Once this money is gone, stay in.
• Always be in control of your cashflow to maximise credit interest and minimise debt charges. This can help you juggle bills and stay in the black. Find out exactly when any loan and/or grant will hit your bank balance. The same applies for cheques from parents.
• Know exactly when bills should be paid, and pay them on time if there are penalties for not doing so, and at the latest possible moment when there are none.
• Where possible, buy course books second-hand. Most universities have book sales and the students union or National Union of Students on campus should be able to provide details of where and when they take place.
• Most colleges and universities discount the prices of meals sold at food outlets on campus. Alternatively, those heading to Glasgow University will find that restaurants and cafes in the West End run various discounts, including happy hours or "three courses for 5" lunch deals.
• But don't just go for discounts at the obvious places. Keep your eyes open for other offers, and always ask about them. A surprising number of hairdressers, restaurants and shops will offer discounts to students - whether they advertise this or not. Don't be afraid to ask.
• Get a part-time job. Provided it will not adversely affect academic studies, having a part-time job, at least in the first couple of years at university, can help keep debt to a minimum.
• Banks including Lloyds TSB and First Direct will text a customer's bank balance to them once a week. Either sign up for a text alert or get a printout from an ATM once a week, as this will help keep bank charges - which can be as much as 30 each time a person goes over their overdraft limit - to a minimum.
• Never borrow from the bank without asking first, and always pay any balance on a credit card off in full as soon as the bill arrives.
• Check out the charity shops for cheap designer label clothing.
• Get a bus timetable and always plan a night out so you know how you can get home. Otherwise late-night taxi hops will eat a huge chunk out of your budget.
TIME TO TAKE ACCOUNT
COLLEGE years are said to be the happiest of our lives, yet three-quarters of students are more worried about debt than failing exams, according to research from NatWest Bank.
If students embarking on university courses this September are to graduate in rude financial as well as academic health, choosing an appropriate bank account is vital. Studying the nuts and bolts of an account, such as overdraft limits and credit interest, may be unappealing but this is important if debt on graduation is to be kept to a minimum.
Many accounts also offer free gifts, although some are more valuable than others. NatWest, for example, offers a free five-year railcard, worth 100. This can be helpful for those who travel a lot, but not as vital as convenient access to free cash machines. A free MP3 player may be attractive, but is not as important as a generous free overdraft limit. So what should you look for when choosing an account?
Many student accounts can be operated both via branches and online. Novice bank customers are likely to appreciate a branch either near or on campus so any problems can be quickly dealt with in person. Some banks offer dedicated student advisers.
Find out which branches are closest to your university. Provided the overall packages are competitive, consider banking there. Otherwise the inconvenience of visiting the bank, along with the cost of travelling, might deter you from actively managing your money and acquiring good banking practices.
Where there are no convenient branches nearby or if you decide the best account for you is with a bank that does not have a branch nearby, it is vital to ensure you have access to free cash machines. Universities are one of the target sites for charging dispensers, which can levy fees of 1.75 per withdrawal.
All of the main banks, except Clydesdale and Royal Bank of Scotland, offer staggered interest-free overdrafts, which are designed to increase with each year of study.
Abbey, HSBC and Barclays offer a 1,000 free overdraft to first-year students, while Lloyds TSB offers 1,500 and Bank of Scotland 1,750 to those starting university or college in 2006. The amount available interest-free then climbs each year to 2,000-2,100 in the final year of study.
Royal Bank of Scotland is the exception, offering a 2,500 interest-free facility from year one. Those tempted should remember that once the limit is reached it will not rise any further.
Once all interest-free facilities are taken into account, students should then look at what banks will charge for any authorised overdraft beyond the above limits (see table). Clydesdale has an authorised overdraft limit of 5.64%, but the account has no interest-free overdraft. Bank of Scotland charges 7.2% and Lloyds TSB 7.4%. HSBC's rate is almost treble that of Clydesdale at 15.9%. By contrast, NatWest will lend at 0% on further borrowings, but you must specifically apply.
Interest when in credit
While overdraft limits may be paramount in most students' minds, it is important not to overlook the rate an account pays when it is in credit. This is especially important for students who intend to take on a part-time job, or will be in receipt of some form of grant or loan.
According to Moneyfacts, the credit interest rates of some of the UK's biggest banks are derisory. Barclays, HSBC, Lloyds TSB and NatWest pay a paltry 0.1%; Abbey is a little better at 1.49%, while RBS and Bank of Scotland both pay 2%. The best of the lot is Clydesdale, which has set a credit interest rate of 3.25% this year.
Linked credit cards
All the big banks offer a credit card to those signing up to its student current account. Credit limits vary from 350 at Abbey to 600 at Barclays; Lloyds TSB and Bank of Scotland say their limits are negotiable.
But students must treat credit cards with extreme caution. These can be a useful money management tool - provided the bill is paid each month. With little or no credit history, students can find it difficult to get a cheap credit card elsewhere and should therefore check the interest rate on the card attached to their student account before signing up. Credit cards can encourage gratuitous spending and soon become a debt trap with interest ratcheting up at an alarming rate.
IN ENGLAND AND WALES
ONLY a tiny number of Scottish students - about two out of every hundred - go south of the Border to study. But those who do, perhaps because there isn't an equivalent course in Scotland, or to broaden their horizons, face stiff financial disincentives.
They will have to pay the 3,000 top-up fees which English students face and it will not be possible for them to live at home to save money. However, the shorter three-year courses should potentially offer the prospect of lower rent and food bills.
Nevertheless, surveys have put the cost of a university education in England at more than 20,000. Although 3,000 is supposed to be the most an institution can charge, few charge any less. Fees are slightly cheaper in Wales, which has introduced a flat fee of 1,200 annually.
Checking out bursaries becomes even more crucial - institutions charging the full 3,000 top-up fees are required to provide a range of bursaries, which should mean many more become available.
Some of these will be designed specifically to help less well-off students and are based on need, while others exist to reward and encourage academic ability. A typical bursary might be 1,000 annually.
Students can also apply for an annual bursary of 2,000 from the Student Awards Agency for Scotland. This is means-tested and paid in full for students whose household income, including their own, is less than 17,930. Up to 31,775, the bursary is tapered. Above that students get nothing.
Finally there are loans. Students can borrow the full 3,000 to cover their fees, plus 850 towards their living costs. On top of this, they can borrow up to 4,300 if their parents earn less than 22,560. Otherwise the loan is means-tested. The SAAS website calculator at www.student-support-saas.gov.uk will give a fair indication of what you are likely to be eligible for.
Students studying in London can qualify for a slightly larger loan of 5,305, but, again, this will be means-tested.
'I got a job just to save up some money'
EIGHTEEN-year-old Andrew Knight already has two jobs in supermarkets to help keep him financially afloat when he begins a law course at Glasgow in the autumn.
The teenager from Insch in Aberdeenshire says he has a good idea about the financial commitment he will make when he begins studying, and although he has yet to draw up a budget, he is determined to keep a close check on spending, and therefore debts.
But he is also realistic: "I think I will get into a bit of debt, but as soon as I finished school I got a job just to save up some money.
"I have two jobs now, but I think I will just work in the holidays once I begin my course because the workload will be heavy."
Andrew is also fairly confident that his choice of course will make it easier for him to find a job when he graduates, which he hopes will help him clear any debt he does incur reasonably swiftly.
"Heaps of people will go into debt, but I hope I'll have a good chance of finding a job quite quickly afterwards and pay it off."
He has also picked a Lloyds TSB student bank account with a little help from his dad.
"I didn't pick the account for the iPod [currently offered as a free gift by the bank]. My dad helped me by looking at the accounts and he thought the Lloyds TSB one looked good.
"There is an interest-free overdraft of 1,500 and I thought that would be pretty good if times were rough, as I could take that out and then work in my holidays to pay it off."
'I knew there would be a cost to switching courses'
KIRSTY Strong is one of the few students in Scotland who have had to pay their own tuition fees. After two years studying geography at Glasgow University she decided it wasn't for her, and switched to a four-year business studies course at Glasgow Caledonian.
The 23-year-old from Elgin had made a good financial start to her student career - she worked for nine months before going to university, so she was able to pay her way and emerge debt-free from Glasgow.
However, because she was repeating years she has had to pay her own tuition fees (about 1,500 annually) for the second course. With other living expenses, she soon built up debts of about 8,000.
But these would have been much higher if her parents hadn't bought a flat in Glasgow's West End where she has been living rent-free for the past two years.
She says: "There are three of us living in the flat and the other two pay rent which helps cover the running costs, and my parents let me live there rent-free."
And Kirsty, who has just completed her second year at Caledonian, still has two years of study ahead of her. However, she has a paid work placement for her third year - with Xerox, based near Paisley - so she hopes to reduce her debts before starting her final year.
She admits: "I knew there would be a big financial cost to switching courses.
"I'd managed debt-free for my first two years even though I'd shared a [rented] flat with friends. I work at functions around the city, so I was able to make some money.
"But geography wasn't what I wanted to do. I just wish I had switched sooner."
'I did think about further studies but the expense of it all held me back'
RECRUITMENT consultant Rebecca Scott, right, is only now beginning to pay off her student loan of around 6,500 even though she graduated from Edinburgh University some three years ago with a psychology degree.
Becky, who is 25 today, counts herself lucky that her debts are much lower than many of her contemporaries, partly because she opted to live at home for two out of her four years of study.
But her debts are about 1,000 higher than they might have been, because in her first year she was caught by tuition fees, which were introduced in 1997, only to be scrapped in 2000.
She remembers: "I come from Edinburgh, but still thought it would be a good idea to live in a student flat in the first year to make friends.
"Then I went home for the second and third years. In my final year, I moved out again to share a flat with friends."
She took out a student loan every year to make ends meet and also ratcheted up a 2,000 interest-free overdraft with the bank.
But she worked part-time in a bar throughout her course, which helped keep borrowings down.
Although Becky says that she doesn't worry about the size of her debts, she admits the thought of sinking even deeper into the red did hold her back from embarking on postgraduate studies.
She says: "I enjoyed my degree but I wasn't one of these people who always knew exactly where they were going. When I finished I didn't know what to do, and did think about further studies, but the expense of it all held me back."
Instead, she worked until she paid off her bank overdraft, and then went travelling for a year around South Africa, Australia, New Zealand and America.
On her return she went into recruitment consultancy. She said: "It's only now that I have got to start making the loan repayments. I wasn't earning enough initially, and they freeze payments when you go travelling.
"But there have been some delays, as a good chunk of my earnings are commission-based. They fluctuate from month to month, which the loan company seems to have had difficulty coping with."