As A-level results day approaches (17 August), millions of UK parents could be counting the cost as their children get set for university. A study carried out by Aviva finds parents of university students typically give their children £3,446 per year (around £287 per month), to support them through their studies. This adds up to more than £10,000 on average over a three-year degree.
- But only one in seven parents save enough to cover all university costs
- One in five parents surveyed said university wasn’t worthwhile for their children
- 4 in 10 parents of students with jobs while at university said work affected their studies
- Almost a third of parents give children money to pay off student debts
However, one in 10 parents give children at university at least £9,000 a year (£750 per month), while a quarter of parents (23%) give studying children at least £5,000 per year (around £417 per month) to help cover all aspects of university life, including accommodation, living costs, fees, text books and travel.
The insurer commissioned a survey of 2,000 parents who have children at university or who have been to university in the last 10 years.
Eight out of 10 parents questioned said they had given their children some financial support while studying. However, only one in seven parents (14%) said they had saved a fund which would cover all university-related costs for their children.
To put this in context, figures from Aviva’s summer 2016 Family Finances report suggest that those who recently joined higher education could find themselves with £44,000 of student debt when graduating.(1) Alongside this, Family Finance data also shows that the typical UK family has £3,134 in savings.(2)
Students still work to support their studies Even with support from parents, a significant number of students still work to support themselves while studying. Forty-three per cent of parents said their children had a job during term time, while 42% said their children worked during university holidays.
Worryingly, 37% of parents whose children had paid employment while at university felt that work commitments had a negative impact on their children’s studies. Of even greater concern, one in five parents said that they didn’t feel university was worthwhile for their children.
This echoes an Aviva survey carried out in 2016, which found that 37% of graduates regretted going to university, due to the resulting debts.
Financial help from the extended family A third of parents said their children had also received financial support from other family members or friends. Grandparents were the most likely contributors, with more than a quarter (27%) giving money to their studying grandchildren. Siblings helped out 6% of students, and 2% of students received financial support from friends of the family.
Almost a third of parents surveyed (30%) have given, or plan to give, money to their children to help with student debts, although only one in 10 (9%) will pay off these debts completely.
Louise Colley, Customer Director for Aviva says: “The vast majority of parents with children at university are helping them financially throughout their studies, but few have the funds to cover all related costs. Aviva research suggests that students could find themselves with £44,000 of debt on graduation – so it’s understandable that many parents aren’t able to give their children this level of support.
“The average age at which people have children is also increasing, with 22% of babies in England and Wales born to mothers over the age of 35 and more than 4% born to mothers aged 40 and above.(3) For fathers, the number of older parents is even higher. This means many parents could be facing the dual challenges of supporting children through university while preparing for retirement – and potentially caring for ageing parents too.
“By saving even small regular amounts - particularly from when children are young - parents can help to prepare themselves for the possibility of funding university in the future.”
Saving to help cover university costs: Alistair McQueen, Head of Savings and Retirement adds: “Covering all the costs for a child going to university can be a real challenge and it’s quite understandable that most parents aren’t funding all aspects of student life.
“That said, saving is a great habit to get into, and a parent who can afford to put aside an extra £112 a month(4) - less than £4 a day - from the day their child is born to their 18th birthday, could generate £35,706 over this period, the equivalent of £25,000 now. This could be a huge financial lifeline for children starting higher education.”
Additional university student facts and figures:(5)
- In 2015–16 there were 2.28 million students studying at UK higher education institutions.
- In 2014-15 there were 164 higher education providers - including 135 university members - in the UK.
- Almost one in five (19%) full time and sandwich students at UK higher education institutions live with parents or guardians while they study.
To find out more about the real cost of graduating, visit Aviva's news and guides section here.
Ends
Media Enquiries: Aviva Press Office | Sarah Poulter | 07800 691569 | sarah.poulter@aviva.com | @sarahpoulter
Notes to editors:
Unless stated, all figures are taken from research carried out by Censuswide in June 2017. 2,000 UK parents who have children at university or who have been to university in the last 10 years were surveyed online.
(1) Source: Aviva Family Finances Report, summer 2016.
(2) Source: Aviva Family Finances Report, winter 2016/17.
(3) Source: ONS data shows that 22% of babies in England and Wales are born to mothers over the age of 35 and more than 4% are born to mothers aged 40. In England and Wales 37% of babies are born to fathers over the age of 35 and 15% to fathers aged 40 and above.
(4) This assumes a median tax-free level of growth of 5%, annual inflation of 2%, and product charges of 0.75% per annum. In order to cover the typical student debt of the equivalent of £44,000 in 18 years’ time, this would equate to £196 per month, with the same assumptions, or £146 per month assuming higher tax-free investment growth of 8%.
(5) Sources: Information provided by HESA and UniversitiesUK.ac.uk
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