Martin Lewis: How much the Govt expects parents to give their children while at university 2021/22

As a result, many don't get the full loan. And parents are meant to fill the gap. But nowhere in the main Student Loans Company (SLC) communications that I've seen does it say this.

The only place I can find it is in the SLC's 'How you're assessed' guide, which students are meant to read when they apply for a loan. There it just says: "Depending on their income, parents may have to contribute towards the living costs of their student children". Well that's helpful!

What's needed is a far more accurate, helpful, loud and large...

"Students – your loan for living is £x,xxx a year. This is less than the full loan and we expect your parents to make up at least the £x,xxx difference."

Yet all this goes unsaid. People just get a letter saying what they will receive, not what they won't be getting. That's wrong. Many parents I meet – for example, at my TV roadshows – either don't realise they're supposed to contribute, or see it as a loose amount.

In fact, parents and students often complain to me that "the living loan isn't enough to cover their rent, never mind living costs – I have to give them extra". However, when I question them, it's often parents whose offspring don't get the full loan saying this – the 'extra' is actually the gap.

Of course, even with the full living loan, many will struggle (see my old Living loans aren't large enough blog) – and that too is an important, though separate, debate. It's also a reason that in my ready reckoners below I call this the 'minimum' parental contribution, as often more is needed.

For full info on how the student finance system works, see my 20+ Student Loan Mythbusters guide.

PS: I should note I've lobbied and even formally written to governments asking for this – see letter to minister. This recommendation was taken up by the Augar review, which was done for Theresa May's Government, but she resigned before it was enacted.

Parents may be supposed to help with living costs, but the loan is the student's

Before carrying on and talking the numbers, it's worth noting many parents panic about their children being in hideous debt after university, especially if they won't earn much. If you're thinking that, then I strongly suggest you read my 20+ Student Loan Mythbusters before carrying on, but in brief:

Student loan repayments actually work far more like a tax than a loan (it'd do a lot of good if we stop calling student loans a debt!). Here's why...

• They don't go on credit files.
• They're repaid through the PAYE payroll.
• You only repay 9% of everything above £26,575, regardless of how much you borrowed, so it's proportionate to income.
• If your income drops, so does the repayment.
• Most will repay for 30 years, then it stops.

In many ways, financially it's a no win, no fee education.

Funnily enough, the real issue is that student loans aren't big enough – as the living loan, even with the full parental contribution, is a struggle to manage with. So it's far better to help them with that.

As for repaying the loan, most parents wouldn't help their child if they earned enough to pay the higher rate of tax, and that's really what paying their loan for them means. For more on this, see my old Beware paying tuition fees upfront guide.

So to fix the mismatch of info and expectation, my parental ready reckoners are below, which show the minimum parents should contribute. I will go through it UK nation by UK nation in a variety of categories.

All I've done is calculate the maximum award from the state and subtract the actual award received. This is done via an assessment of parents' residual income (explained in full in point 9 of the Student Loan Mythbusters guide).

If parents then give what's listed, their offspring will be in the same position as someone from a lower income background getting the full state support.

The figures are for full-time non-'independent' students starting in academic year 2021/2022. They don't include any extra funds for students with dependants, disabilities or those studying for an NHS degree. And it assumes you have no other dependant siblings that your parents may also be supporting (if so, the household residual income is counted as being slightly reduced).

Ready Reckoner 1: For students living at home with parents

FOR THOSE WHO LIVE IN SCOTLAND

In Scotland, the maximum amount you could receive to live off is £7,750. This is made up of a loan of up to £5,750, regardless of where you study. For students with household income under £34,000, you could get a non-repayable bursary (ie, grant) on top of up to £2,000.

So here I've counted the parental contribution as the gap between the maximum combined loan and grant and the amount received. You could equally chose just to do it off the loan amount – I will leave that debate to you.

FOR THOSE WHO LIVE IN WALES

In Wales, there isn't actually an expected parental contribution as all students, regardless of household income, get the same amount depending on where you live – a maximum of £8,790/year if living at home, £10,350/yr living away from home outside London, and £12,930/yr living away from home inside London.

But depending on your household income, some of this maximum amount can be paid as a non-repayable grant instead of a repayable loan. All students get a minimum grant of £1,000.