As A Level Results Are Published, Parents Underestimate Student Debts

On the day that A level results have been published, Standard Life is warning parents about the high levels of debts that students are accumulating at University.

The jubilation of A level results and the confirmation of a university place could soon be met with the reality of the costs of going to University.

Standard Life has discovered that more than half of parents potentially underestimate the maximum amount of debt their child could leave university with.

The rise in tuition fees to £9000 per year being charged by most Universities is going to make matters worse for students from next year.

Most parents think that their child will leave University with £40,000 or less of debts, however Standard Life has calculated that students will actually be racking up to £54,000 of liabilities by the time they graduate.

Whilst some forward looking parents are saving regularly for their childs’ tertiary education, more than 60 per cent say that they cannot afford to put money aside to help their child out, forcing a greater reliance on student grants.

“If parents invest their money in the right tax-efficient savings product, such as an ISA or offshore bond and they can make their savings go a lot further. The tax benefits combined with the efficiency of compound interest could help grow their savings considerably and could make a significant difference to them achieving their financial goals and objectives.”, advises Julie Hutchison, head of technical insight at Standard Life.

Martin Lewis, who is heading up the Independent Taskforce on Student Finance Information, believes with the right financial advice and long term planning it is possible for parents to ensure their children can attend university without either themselves or their children having to live with unmanageable debt for years to come.

Whilst he admits parents and students have a right to be concerned about the fee increases, he also believes there is a lot of misinformation floating around.

In the video below this article, he gives parents up-to-date advice and information to make an informed decision about whether university is a feasible financial option for their children. Dr Terry Fish, Head of Twynham School, Christchurch, Dorset also gives his views on why further education really is still worth it.