An overview of things to consider:-
Graduation is the perfect way to celebrate your achievement, however, graduation 'costs'!! - costs to register, hire your gown and hood etc. Many students do not appreciate the costs involved and struggle to find it at the last minute. Please note that if you have outstanding debt to the University of more than £200, this may have implications for graduation.
Mark your graduation date in your diary in September (of your final year) and try and save a little as you go.
Repaying your student/tuition fee loans
You will enter into repayment the April after you Graduation. The amount you repay per month will depend on your income and which funding body has provided your student support package. See the Student Loans Company (SLC) to find out more about which repayment plan you are on and how much per month you will be expected to repay.
The monthly student loan repayment will be deducted at source, i.e. from your salary.
If you go travelling or work abroad, you are still eligible to repay your student loan if you have an income. It is your responsibility to maintain contact with the Student Loans Company (SLC) as non-contact could lead to them activating their debt recovery procedures. In short, this would have a negative impact upon your credit rating and may include legal processes.
Understanding your pay-slip
Any student who has had a part-time job during their studies will be familiar with pay-slips. However, when you begin working as a non-student, additional deductions will be taken from your gross salary, particularly Income Tax, National Insurance and Pension contributions as well as your student loan. Here’s information on understanding your first pay-slip.
The Government introduced a Pension system called ‘auto enrolment’ last year. This means that all employers must sign all staff up to a pension system. Larger employers will have national pension schemes, e.g. NHS, Local Authorities, Government, Universities and Education.
If you have a student bank account at graduation, you are encouraged to visit your bank. Most banks will change this product to another called a Graduate account. Basically, it lets you keep most of the benefits of your student account including your 0% overdraft facility, sometimes for up to 3 years after graduation.
Be aware that the overdraft will need to be paid off by the end of that period otherwise you will be charged for your overdraft.
If you are going onto post-graduate study and a graduate account doesn’t suit your needs, ask your bank and if you can keep your student account.
Not everyone will be motivated to dip into formal financial planning when they get a job, but you can. Take independent financial advice if you are looking to buy any financial product. The Money Advice Service have staff in most areas within the UK who can provide free, impartial information on financial products delivered via your local CAB. You can access their services via our CAB outreach on campus.
UK Students who do not have a job when their course completes are entitled to claim unemployment benefit. The Government has introduced new benefits within their Welfare Reform Agenda: in the main, this is Universal Credit which replaces Job Seekers Allowance. Universal Credit should be ‘rolled out’ across all of the 32 Scottish local authorities by April 2016, and you are encouraged to contact your local CAB for advice regarding applying.
Important: The relevant date is the last date of your course, not the day you Graduate.
Dealing with debt
Understandably, most students will leave university with debt mainly comprised of their student loan and overdraft facilities. For some, there could be credit/store card debt and car payments.
If you are concerned about repaying your debts, free and confidential debt advice is available from CAB across the country.