The Bank of Mum and Dad is expected to fork out an estimated £5.8 billion over the coming academic year in order to support their children through university.
Even though higher education is an opportune time for young people to learn how to effectively manage their finances, parents are still set to pick up a large chunk of their children’s bills, as the costs associated with living and higher education rocket.
The new research from uSwitch.com has shown that, overall, parents will spend £417 a month – adding up to more than £5,000 over the year. With over 1.1 million full-time undergraduate or foundation degree students at universities across the UK, parents across the country will be collectively spending the staggering amount which will go into the billions.
The findings are more-than-double the amount as recently highlighted in similar research from NotGoingToUni which showed parents will be dishing out £2,285 each year during their children’s time at university.
According to uSwitch, though, accommodation is set to be parents’ single most expensive outlay, with contributions to rent costing them an average of £101 a month. Meanwhile, contributions to tuition fees – which are set to rise beyond £9,000 a year – will cost parents a further £71 each month, while food adds another £44.
Parents believe their contributions to bills are higher than they should be, with only a third thinking their children are on the best deals available. Across all household bills, parents anticipate they could be overpaying by over £54 per month, or £651 per year.
Claire Osborne, consumer expert atuSwitch.com, described how time spent away at university is meant to be “the best time of our lives.” However, the rising cost of studying and living means students are struggling to get by financially. She said: “Thankfully, many parents are prepared to provide the financial help they need, but it’s always worth checking where money could be saved.”
The survey’s findings have come at a time similar research has painted a bleak picture of student finances for the 2016/17 academic year. New findings from HSBC found the first 100 days of the term alone are set to cost freshers an eye-watering £3,300 each, as students say living away from home is more expensive than expected, leaving them feeling overwhelmed at having to manage their own finances for the first time.
Sati Dhanjal, vice president, described how it was clear young people don’t get enough education about one of the most important factors they’re going to have to deal with when they reach independence: money. She added: “Things are hard enough for them, with a lack of jobs and the recession, without adding credit card debt into the mix.”
A University of Southampton and Solent NHS Trust study recently highlighted how students who experience financial difficulties and worry about debt have a higher chance of suffering from depression and alcohol dependency.
Leader of the study, Dr Thomas Richardson, described how the findings suggest “a vicious cycle” whereby anxiety and problem drinking “exacerbate financial difficulties,” which then go on to increase anxiety and alcohol intake. He said: “Interventions which tackle both difficulties at the same time are therefore most likely to be effective.”