To get an overview of just how parents and students manage these costs, this week the Irish League of Credit Unions (ILCU) published the results of its annual ‘Cost of Third Level Education’ study. The third level education research asked both parents and students about how they meet the costs of third level education and the financial challenges facing families around the country. The results highlight what the impact of sending children to college (in financial terms) has on family spending and budgets as well as the challenges and concerns parents have in relation to finance, debt, accommodation, course choice and job prospects.
WHAT THE PARENTS SAY
87% (down from 94% in 2015) of parents in Ireland support their children with college related cost by contributing an average of €447 per month per child with 62% of family budgets have been adversely affected by the increased registration fee. 73% of parents say they will struggle with the costs of college. In terms of how parents cover the costs - monthly income followed by credit union loans and savings are the most common ways in which parents pay for college.
60% of parents expect to get into debt in order to finance the cost of third level education for their children. €4,300 is the average debt per child, per annum that parents will incur. Parents are saving for an average of 8 years to ensure they have enough savings to cover the cost of sending their children to college. The average amount being saved is €8,150.
Getting a job after college is, in 2016 the biggest concern for parents (32%). Passing exams ranks second (17%) closely followed by misuse of drink / drugs (17%, up from 10% in 2015).
WHAT THE STUDENTS SAY
For those students funding their college education, paid employment is the most common method used by 26% of students (down from 29% in 2015). Existing savings are the next most popular way in which students pay for their college experience (22%). This is followed by the grant (17%), money from parents (14%) and a credit union loan (9%). Only 33% of students have received advice on (or have been offered) advice on payment plans by their educational provider to help meet costs.
Not surprisingly, students living away from home are spending almost twice as much as those living at home. On average those living away from home are spending €1,048 per month on rent, transport, living and college related expenses. Students living at home are spending on average €530, up from €474 in 2015.
68% of students will work through the college term. Students are working an average of 17 hours per week, getting paid an average of €12 per hour.
Male students are working longer hours at 21 hours per week compared to females who are working an average of 15 hours per week. Male students are earning an average of €252 per week, (down from €336 in 2015) and female students are earning an average of €180 per week, down significantly from €262 per week in 2015.
23% (down from 33% in 2015) of students skip lectures to work during the college term. More females students (25%) than male students (19%) doing so.
Passing exams (83% up from 74% in 2015) continues to be the biggest worry for 3rd level students followed by personal finances and debt as the second biggest worry (57% in 2016 to 60% in 2015). Other worries revolve around quality of their course (44%), not getting a job (40%) or finding their course too difficult (38%)
Availability of accommodation (56%) and the expense of renting (33%) are the main reasons behind why students find it difficult to find suitable accommodation for college. 67% of students are extremely worried that will not be able to find suitable accommodation for the coming academic year. 9 in 10 students view the cost of student accommodation as very high.
Interest continues to be the primary consideration for choosing a college course (39% up from 35% in 2015). This is followed by job prospects (24%) and location 17%) and college reputation (9%.)Heading off to college is an exciting time. It can also be very stressful for parents and students alike, as the cost of third level education can be a significant burden. Families are already struggling with the wider impact of austerity and paying for college has become increasingly challenging for many. Some financial institutions try to attract students by offering short term deals to open an account or offer an interest free period on a loan before a higher rate kicks in. This is not how credit unions operate. Credit unions offer loans at fair rates with flexibility to meet members’ needs. Each credit union sets its own interest rates and has its own loan criteria. Your local credit union can give you details of their current interest rates. Many credit unions offer dedicated student/education loan rates, which are often significantly less than their standard loan rate. This helps to make financing third level education as affordable as possible for students.