As children draw breath after their recent GCSE and A level exams, here is a summary of the current support available from the Isle of Man Government.
I hope this is useful for parents whose children are likely to attend university in the coming years.
Tuition fees are currently up to £9,250 per year. All Isle of Man resident students must pay at least £2,500 per year towards their tuition fees.
A government loan of £7,500 is potentially available to fund a three-year course, with repayments starting once the student’s annual income reaches £25,000.
The Government’s contribution of £6,750 is reduced when the family’s gross annual income exceeds £112,000. Where income exceeds £132,000, no support is available.
Maintenance grants are intended to help with living costs.
An annual maintenance grant of up to £7,500 may be available. However, this is also means-tested, but at a much lower rate.
Income over £17,000 will see a proportionate reduction with no support available where income exceeds £61,795.
The payment table can be found here: How to calculate the amount of maintenance.
Actual living costs vary greatly depending on location and lifestyle.
Published university estimates range from £8,500 to £10,500 per academic year and are not immune from the cost of living increases we are all experiencing.
For Manx students, additional consideration should be given to the cost of travel on/off island and other accommodation or storage costs between terms.
What does this mean?
Personal loans are an option. A part-time job might also be an option for students to top up their income.
But for those looking to save in advance, it helps to know the numbers.
For those entitled to maximum Government support, and who take a student loan for their fees, parents need to be saving enough to support additional living costs, travel expenses (including the initial move over) and an emergency pot for unexpected expenses, sports/social trips etc for the duration of the course.
For those who aren’t entitled to government support, £20,000+ per year is a good starting point.
For parents with more than one child expected to be simultaneously at university, those looking to study abroad, or those considering longer courses/Masters, etc., savings need to be more substantial.
It might be preferable to save enough not to rely completely on government support at the current generous levels.
At worst, any excess savings could easily be repurposed to help get them on the property ladder – or to enjoy a bit of role reversal and treat yourself to a lovely relaxing holiday whilst your child is studying hard!
Please contact us if you want to discuss the benefits of making a financial plan for your family’s future or our regular investment solutions.