Students On A Shoestring - Cost Of University Eclipses Average Student Income By 300 Per Cent

30th August 2024

More than three quarters of students worried about cost of university life, a new poll from Nationwide shows.

Average monthly income of £752.20 dwarfed by expected living costs of £2,197 - a threefold increase.

Over half of students are set to start university in debt - 1 in 4 more than £1,500 in the red.

Nationwide launches latest FlexStudent current account: £100 cashback, 12 months of JustEat vouchers, interest-free, fee-free overdrafts up to £3k and commission-free purchases and withdrawals abroad.

More than three quarters (78%) of students fear how they will get through university as escalating bills, rent and prices pile pressure on their limited finances, research from Nationwide shows.

The poll of 2,000 UK university students1 was carried out by Nationwide to better understand how students are managing their money. It reveals that while the average student expects to have £752.20 to spend each month, their outgoings will come to three times that amount, at £2,1972- equivalent to the entire monthly take home pay from a £32,000-a-year job3.

Furthermore, more than four in ten (42%) will have less than £500 to spend per month, with two per cent having under £100 – putting even more pressure on cash-strapped students to make ends meet during their studies.

It comes as Nationwide launches its new FlexStudent current account4 - the account offers £100 cashback and 12 months of Just Eat vouchers worth £120 – providing £220 of benefits to students in their first year of university. The account also includes an interest-free and fee-free arranged overdraft of up to £3,000 by the third year in addition to commission-free purchases and cash withdrawals abroad (eligibility criteria applies).

Given the rising cost of living for students, it is little wonder that financial worries are the biggest issue for new and existing students. Half (50%) of all students cite it as a concern – around double those concerned about missing their family and friends (25 %) and significantly above the number of students worried about keeping up in class (36%). Some 76 per cent say money worries negatively impact their mental health.

One of the issues facing students is pre-existing debt. More than half (56%) are in the red before even starting university and more than a quarter (27%) are over £1,500 in debt before setting foot on campus.

On the positive side, students are willing to seek help, with 55 per cent open to speaking to their bank or building society for support, while 45 per cent would turn to their parents. However, over one in ten (12%) would bury their heads in the sand if they were having money issues, hoping the situation would improve on its own.

Over six in ten (66%) worry that they will be leaving university in significant debt. Most students would resort to borrowing from their parents (52%) or getting a job to supplement their income (44%), almost one in four (22%) will try to sell items online to make sure they can scrape together enough to manage their expenses. Almost half (48%) would consider borrowing more, with more than one in ten (12%) considering a payday loan.

Tom Riley, Nationwide's Director of Retail Products, said "University can be a nerve-racking time for many students. It is often the first time they will need to manage their own budgets and expenses. Our FlexStudent account has been designed to support students and help them live their best lives. We hope that between our cashback offer, Just Eat collaboration, commission-free usage abroad and our interest-free, fee-free arranged overdraft, students will be able to stay in control of their finances allowing them more time to enjoy their university life."

Students expects to spend each month on average on the following categories:

Categories of expenses
Average expected spend per month

Rent
£291.61

Food
£144.22

Household supplies i.e. cleaning products
£86.98

Toiletries
£85.36

Internet
£78.74

Gas/Electric
£106.84

Water
£84.87

TV License
£72.70

Content insurance
£84.95

Mobile phone
£87.33

Public Transport
£89.99

Car costs i.e. petrol/maintenance
£99.02

Debt repayments
£94.04

Books
£79.29

Music subscription i.e. Spotify/Apple Music
£67.90

TV subscription i.e Netflix/Disney plus
£75.54

Socialising
£98.41

Takeaways
£85.02

Restaurants
£84.81

Clothes
£115.52

Shoes
£96.14

Stationary / university equipment
£89.21

From Nationwide
https://www.nationwidemediacentre.co.uk/news/students-on-a-shoestring-cost-of-university-eclipses-average-student-income-by-300-percent