Are UK Universities Too Expensive?

As thousands of teenagers look over their A-Level results and decide what to do next, research from Child Trust Fund provider The Children's Mutual, has highlighted the cost of a three year university study to students and their parents. So are UK universities too expensive? And how can the financial strain be eased?

According to the latest figures from The Children's Mutual, for the average three year university course, a student will need to have around 42,000 pounds behind them - an amount of which a good proportion is likely to come from student loans. However, new research has shown that the rest of this funding is also likely to come from parents who are then either forced to take from their savings, or maybe even remortgage their house.

University costs are also likely to have been exacerbated by the lack of summer jobs available to those who are due to start their higher education in October. This has meant that unless children have been working during their A-Levels, they may have even less saved up for when they leave home.
Although it seems easy to label UK universities as too expensive, particular in regards to recent recessionary developments, in 2005 the government did establish the Child Trust Fund (CTFs) in order to ensure that future students will have a significant amount of money to fund their studies should they need it. CTFs are also intended as an incentive for both adults and children to open savings accounts - and to learn about the importance of putting money away.

However, it should be acknowledged that those eligible for a CTF must have been born on or after the 1st September 2002 - leaving a significant gap of future generations who are likely to be in a similar situation to this years graduates. Overall, the cost of this years graduates is said to be at around the 25 billion pound mark, 3 million pounds more than last year. If this is set to increase at the same rate, by 2015 this amount will have reached 43 million pounds. Consequently, if parents can afford to put any money away now, they should certainly do so - and as I write this, fixed rate bonds are currently a better option than ISAs in terms of average returns.

Paul Roberts writes about banking, savings and the best savings rates.

Young People Turning Backs On Debt

Research has found that young people are turning their backs on spending and credit cards in favour of saving money.

A poll by Ci Research found that 70% of people aged between 16 and 26 are not comfortable with accumulating debts and would rather save up for things they want to buy. They added that they would only borrow money as a last resort.

However, figures show that there are young people who are less reluctant to take on debt, with 4% of the 500 people questioned saying they did feel very comfortable with debt.

The survey found that the economic downturn is having a significant impact on young people's saving habits. A quarter of people said they were now saving more than they had been and 19% plan to set aside more cash.

A further 62% said they did not have a credit card and 75% said they were keeping a close eye on their finances. Just 12% of those questioned said they were saving less or had stopped saving altogether.

Colin Auton, of Ci Research, said: "The report reveals undeniable proof that recent economic changes have influenced young people's behaviour and opinions on both spending and saving."

Sourced from Confused.com [link]