Petition for student funding to be paid monthly

[ADK]

Just set up a scheme that helps the vulnerable to manage their money then.

 

Getting your funds in one hit is simply financially preferable, so why would students support something that is making them worse off?

[RobHawk]

Just set up a scheme that helps the vulnerable to manage their money then.

 

Getting your funds in one hit is simply financially preferable, so why would students support something that is making them worse off?

How are they worse off? Same amount of money being paid!

[ADK]

They are worse off because they don't have access to the money at the beginning of the term. Have you ever wondered why companies give you a discount if you pay annually or quarterly as oppose to monthly?

 

What if a student needs a laptop or a car or some other costly item, but can't afford to buy that and cover living costs with 1 months funds?

[pSinatra]

Why would anyone need a car?  I would consider that a luxury item & not a necessity.

 

I had a car during my 2nd & 3rd year.  It was highly unusual for anyone to have a car.  I paid for it by working during the summer months.

 

I appreciate that there are things like books that may be essential & can be expensive.  Maybe a larger payment in the first month & the rest of the money spread out over the remaining months?

[RobHawk]

Surely it's better to get hold of the money asap. If you really can't budget then just ask your parents to hold some of it for you.

 

You'd be surprised the number of students I've seen who have done this but there parents have been struggling and have used the mortgage to cover things like mortgage payments. What happens if you don't have parents, who do you give it to then? Not every students situation is as easy as you seem to think!

 

Just set up a scheme that helps the vulnerable to manage their money then.

 

Getting your funds in one hit is simply financially preferable, so why would students support something that is making them worse off?

 

And how much such a scheme cost? There are alot of vulnerable students and they need specialized support so it wouldn't be cheap!

 

They are worse off because they don't have access to the money at the beginning of the term. Have you ever wondered why companies give you a discount if you pay annually or quarterly as oppose to monthly?

 

What if a student needs a laptop or a car or some other costly item, but can't afford to buy that and cover living costs with 1 months funds?

 

You think most students can afford to cover the cost of a laptop or a car from their student loans anyway? A car would be non essential and most universities have laptops that could be borrowed anyway!

 

In regards to discount for paying annually, maybe for insurance etc but for things like utility bills its usually cheaper to pay monthly D/D.

 

Finally the system of paying monthly already works for Scottish and NHS funds, why wouldn't it work for Student loans in England, Wales and NI as well!

[Rincewind]

Just done my confirmation EMail. Its at 97.

With the part time work I do I know money advisers who have said there are similar problems with Universal Credit. Claimers need to manage on line and all benefits are paid into a bank account, This is fine for the able bodied average person but those with mental disorders, disabilities and other problems may not have access or able to afford or use a computer. Also if some have money in the bank they may use it to feed their family or pay energy bills instead of CT or rent which could lead to evictions.

 

Sorry about being slightly off topic just illustrating how I see it from Robhawks perspective.

[Fox92]

 Respect your view but out of interest whats your reasoning for wanting it termly?

 

I only ask because this is due to go national very soon so if i can get some feedback first that would be great!

 

I'd keep it termly as well. As above, yesterday actually, I posted I could see some people getting into 'trouble'. I do believe this if it was all given at once. 

 

I'm very good with my money, always have been, and I'm ok with my student loan. I know other's around me though that arn't so good at looking after their money and have drawn up a bit of extra debt, via however. Giving it all in one go will just encourage them certain people even more, 'oh I still have xx', but not taking into consideration rent (that's a big one) especially.

 

I pay my rent, and bills on top of that, at the first of each month. I already work out how much money I'll have left over. Yeah I love my loan going in, but my termly loan is enough to cover rent and bills until January. I know a lot of people struggle with financing and I could just see these spending a lot of their loan if it's in one go. At least with it being termly, there is 'backup' to look forward to.

 

(I know I haven't explained too well but I hope you get my point).

[Strokes]

Is all this to avoid getting a part time job?

[RobHawk]

Just to add some more info, this was a response from a colleague of mine up in Scotland - They already get paid monthly and this is what he said:

 

Front Loading - A student’s total living cost award of student loan + young/independent student bursary (maintenance grant) is divided into 10. A first payment of 2 tenths is paid once they have matriculated, in the first week of term/semester at the start of the academic year. The remaining 8 tenths are paid monthly from 7 October to 7 May. So for example, a dependent student from the lowest income bracket would receive a total living cost award of £7250, a front loaded payment of £1450 and monthly payments of £725.

 

Withdrawal/Suspension – As soon as our Registry Team receive confirmation from the student regarding suspension/withdrawal then they update the record through the CoC system. As mentioned by Phil this helps to reduce overpayments and potential claw back against the student in subsequent years (depending on the reason for suspension/withdrawal).

 

As for accommodation issues, our Finance Office increased the monthly payment option for accommodation from 6 months to 8 so no big issue here. Many continuing students that moved from the old to the new system commented on the fact that monthly payments made things much more manageable and I did not receive any negative feedback from these students.

 

Speaking just for my experience at QMU, a small institution, I have found that since monthly payments were introduced here there has been far less demand for emergency funds at the end of academic terms (expect from RUK students on termly payments) and students are learning to manage their income in a much better way. In retrospect the old system (in Scotland) does seem very odd…………in what other sector of society does anyone get paid in three lump sums during the year ? 

 

[lavrentis]

Just to add some more info, this was a response from a colleague of mine up in Scotland - They already get paid monthly and this is what he said:

 

I'll telly ou a solution. Spending what you get, sensibly and calculating what you can spend each week. 

[Jon the Hat]

On one hand FOR THE LOVE OF GOD is this all you have to winge about - if you can't live as a student you won't survive the real world!!!

 

And on the other, if the evdience suggests this would save money becuase fewer students screw up and need the emergency funds, then it is a good idea.

[Rincewind]

I'll telly ou a solution. Spending what you get, sensibly and calculating what you can spend each week. 

In an ideal world yes but we do not live in an ideal world. Not every student has 6 A levels in Home economics or whatever. If they did Money Advisers would be out of a job.

[RobHawk]

On one hand FOR THE LOVE OF GOD is this all you have to winge about - if you can't live as a student you won't survive the real world!!!

 

And on the other, if the evdience suggests this would save money becuase fewer students screw up and need the emergency funds, then it is a good idea.

 

I found out yesterday why student loans are paid termly - because about 15-20 years ago, before online banking and direct debits they used to have to pay loans by cheque and it was easier and more practical to do this termly.

 

Any outgoings like accommodation are paid termly to fit with the way the income is received. Not only should it save money from hardship funds but it also makes sense to bring student loans in line with the rest of the 21st century.

[RobHawk]

I'll telly ou a solution. Spending what you get, sensibly and calculating what you can spend each week. 

 

You think i don't preach this every single day of my working life! I spend far to much of my life advising students about money! If it was that easy there wouldn't be over 600 money advisers employed in University's across the UK! For god sakes if a bank can struggle and nearly go bust why can't an 18 yr old kid! Thats life im afraid, i don't like it but it happens every single day up and down the country!

 

Read everything I've written in this thread, i'm promoting everything you said! All i'm saying is it would be easier all round if students could receive monthly income and create a budget like the rest of the world, based on monthly income.

[Rincewind]

If it is tough for intelligent (?) students to manage think about what it is like for those on low income and low education. The other week there was a Foodbank Action Day. Also there were representatives from Moneywise who give budgeting advice.

The majority of students are 18-25 year olds (?) and what do most 18-25 yr olds like doing when set free from Mother's apron strings?

[James.]

This thread is an example of where people let their own prejudices get in the way of giving a neutral view on what is absolutely blindingly obviously a good idea. Good luck, have signed.

[Jon the Hat]

If it is tough for intelligent (?) students to manage think about what it is like for those on low income and low education. The other week there was a Foodbank Action Day. Also there were representatives from Moneywise who give budgeting advice.

The majority of students are 18-25 year olds (?) and what do most 18-25 yr olds like doing when set free from Mother's apron strings?

 

Low education?  You do know that we are talking about loans for students at University right?  If they have low education they shouldn't be at university!!

[The Doctor]

Really don't think this is a good idea - course texts can be bloody expensive (and with some you have to buy them - my first year text came bundled with a software account - only way to get it - that the lecturer would set work through), halls charge termly amounts, memberships of various things can be needed upfront (I pay for RSC membership and that isn't done as a monthly subscription, not at student rates anyway - cheaper to pay the upfront sum) and then there are unexpected costs like laptop repairs etc. Also add in the way some unis run societies (you pay out of your own pocket and then file for reimbursement) and the termly payments works better as far as I can see.

[RobHawk]

Really don't think this is a good idea - course texts can be bloody expensive (and with some you have to buy them - my first year text came bundled with a software account - only way to get it - that the lecturer would set work through), halls charge termly amounts, memberships of various things can be needed upfront (I pay for RSC membership and that isn't done as a monthly subscription, not at student rates anyway - cheaper to pay the upfront sum) and then there are unexpected costs like laptop repairs etc. Also add in the way some unis run societies (you pay out of your own pocket and then file for reimbursement) and the termly payments works better as far as I can see.

 

Most of your points have been tackled - Accommodation is only charged that way because thats how funding is paid, this could easily be changed to monthly like all other accommodation in the country.

 

Upfront costs - A higher first payment would be made to cover initial costs - See my post re how it works in Scotland.

 

Unexpected costs - Surely monthly payments would be better to budget for these things. If your moneys running low in November and then your laptop breaks the earliest you could get it fixed would be January. That's great when you have exams to apply for!

[Rincewind]

Low education?  You do know that we are talking about loans for students at University right?  If they have low education they shouldn't be at university!!

Sorry I went slightly off subject but I was saying the problem is not exclusive to students. High education does not always mean good budgeting skills.

[indierich06]

I'm a student and I am against this.

 

****s sake students are the biggest group of *****. Always moan about how hard their lives are and stress etc

 

get free money and have the balls to moan about how they get it. If they don't know how to spend it, its noone elses fault. Seen it first hand some people need to grow the **** up

 

Free money? That's a good one!

 

It's not hard to see that budgeting would be a lot easier if you had to do it on a monthly basis, rather than a quarterly basis - yeah, some students will turn up to uni and budget properly and never run into any problems, but a lot of them will turn up naive, never having lived away from home, never having had to manage their money and then they get a massive lump sum dropped into their account at the start of the term - of course some of them are going to go mad and overspend.

 

It's hardly going to inconvenience anyone or cause any problems if it was changed to monthly, rather than quarterly and it could stop some of the more naive and careless students from racking up credit card debt or overdrafts. Surely that can only be a good thing?

 

I think it should at least be available as an option when applying for a student loan - you should be able to choose how it's paid out, whether you want the whole year's worth at once, or by term, otr by month.

[lavrentis]

Free money? That's a good one!

 

It's not hard to see that budgeting would be a lot easier if you had to do it on a monthly basis, rather than a quarterly basis - yeah, some students will turn up to uni and budget properly and never run into any problems, but a lot of them will turn up naive, never having lived away from home, never having had to manage their money and then they get a massive lump sum dropped into their account at the start of the term - of course some of them are going to go mad and overspend.

 

It's hardly going to inconvenience anyone or cause any problems if it was changed to monthly, rather than quarterly and it could stop some of the more naive and careless students from racking up credit card debt or overdrafts. Surely that can only be a good thing?

 

I think it should at least be available as an option when applying for a student loan - you should be able to choose how it's paid out, whether you want the whole year's worth at once, or by term, otr by month.

 

Well lets be honest the terms of the student loan are very laxed. Students often so see it as much of free money. The days of repaying it to a lot of them are far away and now filled with ifs and buts.

 

I don't see the big deal to be honest, any right minded person will budget at uni. As some other people in this thread, those that blow their money will suffer the consequences(if they don't have a hand in their parents pocket already). If they do go mad with money, then maybe thats a life lesson right there

 

I asked one of my uni mates about this last night and he was dead against monthly payments. I can't see how it will change the overdraft situation, from personal experience I've only had to use my overdraft in the summer time when uni is not on (or before the first instalment comes in) which won't matter because whichever method of payment there is, the money wont be in by then anyway.

 

Realistically you don't have to budget too far ahead of when you get your money in anyway, I get mine in October and have to last until a week or 2 before Christmas. Easy done if you budget with what you've got. Problem with a lot of students is they do buy luxuries(which is perfectly fine) but they can't afford it in the long run.

 

I can't speak for lettings agencies but students are so come and go, and a big risk (i know properties that got completely trashed) so 3 big payments is probably better for them as well rather than relying each week/month.

 

I can see how monthly payments might be appealing but I just can't see it. Being a student I can see first hand how incapable some people are with money, only when they've experienced being with no money will they learn to appreciate it ...

[indierich06]

Well lets be honest the terms of the student loan are very laxed. Students often so see it as much of free money. The days of repaying it to a lot of them are far away and now filled with ifs and buts.

 

I don't see the big deal to be honest, any right minded person will budget at uni. As some other people in this thread, those that blow their money will suffer the consequences(if they don't have a hand in their parents pocket already). If they do go mad with money, then maybe thats a life lesson right there

 

I asked one of my uni mates about this last night and he was dead against monthly payments. I can't see how it will change the overdraft situation, from personal experience I've only had to use my overdraft in the summer time when uni is not on (or before the first instalment comes in) which won't matter because whichever method of payment there is, the money wont be in by then anyway.

 

Realistically you don't have to budget too far ahead of when you get your money in anyway, I get mine in October and have to last until a week or 2 before Christmas. Easy done if you budget with what you've got. Problem with a lot of students is they do buy luxuries(which is perfectly fine) but they can't afford it in the long run.

 

I can't speak for lettings agencies but students are so come and go, and a big risk (i know properties that got completely trashed) so 3 big payments is probably better for them as well rather than relying each week/month.

 

I can see how monthly payments might be appealing but I just can't see it. Being a student I can see first hand how incapable some people are with money, only when they've experienced being with no money will they learn to appreciate it ...

 

I've started paying mine back, and I can tell you that when I'm missing about £65-£70 a month out of my pay packet before it even gets to my bank account, it definitely doesn't feel like free money any more!

 

Either way though, I see no reason why you shouldn't be able to pick a payment option when you're signing up for a student loan, as different options would suit different people and there's no reason why it couldn't be done that way really. I didn't really have any major problems with budgeting at uni, and I worked the whole time I was there as well, so I always had plenty of pocket money for going out etc, but I think I would have preferred a monthly payment if it was available - there were no big outlay for materials or books for my course (journalism) and my landlords at uni were always easy going about how they were paid, whether it was monthly or termly.

 

For me personally, it would have been easier to budget on a month-to-month basis, rather than quarterly - but like I said, that's just me. These days, finance is so flexible - there's no reason why student finance shouldn't be the same.

[ADK]

If it was done as an option I wouldn't mind. Being forced into an option you don't want because other people can't manage their money is just annoying.

[RobHawk]

A Foxestalk inspired blogpost on the subject for anyone that is interested http://wp.me/p3YSNk-1S