The Children's Mutual Reports £25 Billion Cost For 2009 University Starters
Released
on: August 24, 2009, 12:16 pm
Author:
The Children's Mutual
Industry: Financial
The Children's Mutual has reported the cost of university for
this year’s recent A-level graduates could be as high as £25 billion -
almost £3 billion more than last year. The Children's Mutual warns
that thousands of young adults celebrating their A-Level results and
their parents may remain unaware of this rising cost.
According to the leading Child Trust Fund provider, the average student needs to find about £42,000 to fund three years at
university, but this doesn’t take into account the costs of any further training
they might want to do after their degree. Currently 87% of young people in the UK
are receiving financial help from their parents and help towards university costs is
something many students expect and parents expect to give*. Increases in
year-on-year university costs also mean this bill will rise in future years.
One way parents of future scholars can help mitigate the rising costs is by saving
regularly from when their children are very small. The Child Trust Fund (CTF) was created by the Government to
provide every eligible child with a nest egg when they turn 18, with parents,
friends and family all encouraged to help save. Launched in 2002, more than 4.4
million children now have a CTF account. Topping up a child's CTF on a monthly
basis could result in a significant lump sum when the child turns 18, perfect for
helping with university costs.
David White, Chief Executive of The Children's Mutual, said: "University can be as
much of a millstone as it is a milestone. While parents will be pleased about their
children's successes as they receive their A-level results and many look forward to
university, the high costs involved can be a real financial strain to a huge number
of students and their parents. For families planning to support their children
through university, finding a lump sum to cover the costs can be very difficult.
Often, parents are left with no other option but to dip into their savings or
remortgage their house. This can have a serious impact on their own financial
future.
"From 2020 all 18 year-olds will have access to their maturing Child Trust Funds as they enter
adulthood and the money saved in these could make a real difference to both future
university students and their parents."
Child Trust Funds are designed to provide a tax efficient, long term savings vehicle
for all eligible children. Each eligible newborn child (born on or after 1 September
2002) receives £250 (£500 for low income families) from the Government when their
parents register for Child Benefit. The
Government will make a second contribution of £250 (£500 for low income families)
when the child reaches seven and is considering a third in the child's teenage
years. Parents, family and friends can all then add to this account up to a maximum
value of £1,200 each year.
- Ends -
Notes to editors
Student figures based on The Children’s Mutual calculations of the National Union of
Students (NUS) stats, workings available on request.
* Based on The Children's Mutual Financial Independence Report, February 2009.
About The Children's Mutual - Home of the Child Trust Fund
The Children's Mutual's mission is to help parents, grandparents, family and
friends fulfil their hopes for today's children. The Children's Mutual is the only
UK company that specialises in long term savings for children and is now the choice
of 1 in 4 parents for their child's Child Trust Fund, with more than 675,000
accounts. This expertise has led several financial institutions and family-focused
high street retailers to choose The Children's Mutual as their stakeholder Child
Trust Fund provider.
The Children's Mutual PR contact:
Katie Donlan
Consolidated PR
22 Endell Street,
London
WC2H 9AD
020 7781 2376
www.thechildrensmutual.co.uk
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