Student Finance

Student debt in the UK has tripled to £18 billion over the last decade – with veterinary and medical students particularly vulnerable because of the length and intensity of their courses (more years of study to fund but less time for part time and vacation work).  Martin Lewis of moneysavingexpert.com says that a certain level of debt is unavoidable for students today: "The real question is, what's the right way to fund, borrow and live as a student?".   

View a You Tube film of Martin Lewis talking to students at LSE about How To Survive Financially As A Student

All students have probably been a little frivolous with their funds from time to time, particularly when starting at university and revelling in the new-found financial freedom of a student loan.  Whilst most learn to rein in their spending after a dose of guilt and realisation of the need to budget, a few don't wake up to the problem until it's too late - as one student tells: I Was Irresponsible With Money - And I Paid The Price

Dealing With Your Debts

The most important way to deal with debt is not to ignore it and hope it will go away. Letters from creditors should always be opened and dealt with as soon as possible. If you don’t reply to the letters, at worst the bank could ‘freeze’ your account and refer the debt to their collections / debt recovery department. This would mean losing both your account and your overdraft facility. At best they will be charging you high interest on an “unarranged” overdraft (the excess borrowing on top of your normal overdraft if you are still over your limit).

Speak to the bank and explain your difficulties. Check when your next student loan payment is due and see if the bank can wait until then for repayment of the unarranged overdraft. If you are paying high interest charges and can’t negotiate with the bank to reduce them, you should try to put some money into the account to get back within your overdraft limit - try to get a temporary loan from friends or family, see the Get Advice page for details of your University's finance support office - they may be able to offer an emergency loan or hardship payment. 

Action List

• Make a list of all the bills, including how much each is for and then prioritise the debts. Very large or very late bills are not necessarily of highest priority. Pay off priority debts first but make sure you contact all creditors so that they know you are not avoiding payment.

Priority debts - these are debts owed to creditors who can take strong legal action against you if you do not pay. These include:
Mortgage or rent arrears - the house could be repossessed by the bank or the landlord could have you evicted
Fines (eg for traffic offences) - bailiffs can be sent to seize possessions or you could be imprisoned
Fuel bills (electricity/gas) - you could be disconnected.

Credit and store cards, bank loans and overdrafts, catalogue debts and money owed to family and friends, although stressful, potentially embarrassing and not good for your credit rating are non-priority debts as you cannot be imprisoned or made homeless or without heat and light. This doesn’t mean they can be ignored - eventually your creditors will take you to court if you fail to make contact with them or make some offer of payment.

• If you can't make your minimum payments or cover your essentials, you can go to a non-profit debt counselling service - Consumer Credit Counselling Service, National Debtline or Citizens Advice Bureau for help.  They will draw up a financial statement with you (a sheet detailing your income and expenditure) and calculate how much available income you have. An offer based on this will then be made to each creditor and a request made for interest and charges on the account to be frozen. If you have no or very little available income token offers of say £1 can be made. An advisor may negotiate with creditors on your behalf as well as checking your entitlement to hardship funds and benefits. If you do not have advisers at your instituition that can provide you with this service your local Citizens Advice Bureau will be able to do this for you.   
  
• If you are still able to make your minimum payments but feel very anxious about your level of debt, you might want to look at the Save Money page on this site for advice on how to cut your costs and use this extra money to gradually pay off your debts. 
  
• Moneysavingexpert.com's Debt Help Plan

AVS/BVA Survey of Veterinary Student Debt 2009:

• Over a third of students surveyed (35%) reported difficult or severe financial problems. 
• Graduate debt has increased by 17% since the last survey in 2005, averaging £22,300 in 2008.  As higher tuition fees were introduced in 2006, those leaving in 2011 are expected to have debts of £29,400.
• 23.4% of respondents said that their debts would have a large effect on their choice of job after graduation.

Student BMJ Survey of How Medical Students Spend Their Money 2006/7 

• Just over 64% said they received financial support from their parents – averaging a little over £3,000 per student for the academic year.
• Average monthly expenditure on accommodation was £320 – ranging from £442 in London to £261 in Wales.
  Other average costs nationally ranged from £117 per month for food and £85 per month for entertainment to £46 per month for personal items.
• Nationally half ran a car or motor bike – but this varied from 36% in London to 73% in Wales.
• 59% of students replying had at least one credit card and owed an average of £969, whilst 55% of students replying had a bank overdraft, averaging £1,426 each.
  

Help for Stress & Depression at Vet School

If you are struggling to deal with your financial problems, you may find it helpful to speak to someone with personal experience of the veterinary profession about your finances and anything else that is troubling you.

You might want to contact your university's counselling service.

Vet Helpline offers an empathetic listening service and can tell you how to get more specialist help if necessary.
Tel: 07659 811 118 (local call rates apply, 24hr rapid response answer phone).

In addition, if you think your financial problems may be linked to drinking, drug use or gambling, the Veterinary Surgeons’ Health Support Programme is available to provide completely confidential professional help with alcohol, drug, addiction & mental health issues. 
Tel: 07946 634220 or email VSHSP@vetlife.org.uk

Part of content is reprinted with kind permission of the Royal Medical Benevolent Fund from www.money4medstudents.org