You are using an outdated browser. Please upgrade your browser to improve your experience.

University students forced to budget better than their parents

Posted on 13 September 2015

Six in ten of 18-24 year olds budget formally

  • 18-24 year olds are more than four times as likely to use a budgeting app than all other age groups combined
  • Half a million young people will leave university £44,000 in debt

As around half a million [1] young people prepare to start university in the coming weeks, armed with the knowledge that they will graduate with more than £40k of debt on average, new research shows they will budget more carefully than their parents and grandparents.

The study, by SunLife, found almost six in ten (57%) of 18-24 year olds budget formally compared to just 39% of those aged 55-64 and less than a third (32%) of those aged 65 and over.

Furthermore, those aged 24 and under are four times as likely to use a phone app to keep an eye on their incomings and outgoings than any other age group, with one in seven using a phone app to budget, compared to just 4% of all the other age groups combined.

Dean Lamble, managing Director of SunLife said: “There could be lots of reasons why younger people are budgeting more formally than their parents and grandparents generations. But, living through seven years of recession – starting at around the time many of this generation started to become responsible for their own finances – has probably had a huge effect on how they view money. The continuing rise in the cost of attending university could also be forcing more young people to keep a very close eye on their finances.”

Grants vs. debts

More than 470,000 young adults [1] will be starting university next week; by the time they graduate they will be £44,000 in debt on average [2]. This compares to their parents and grandparents, who, if they did attend university, would most likely have received a grant to cover their fees. [3]

Student loans weren’t brought in until 1989, and even then, poorer students still received grants of up to £2,265 (equivalent to £6,500 today) [4].

Mr Lamble concludes, “While today’s 50-70 years olds are likely to be the first generation to be better off than their parents and their children, today’s young people are leaving university saddled with tens of thousands of pounds of debt. Younger people are budgeting more stringently than any other age group because they have to. They are making use of the budgeting tools and technology available to them because they have no choice but to budget carefully and be savvy with their cash.”

Ends

About the research

3,985 people were surveyed by Charterhouse on behalf of SunLife as part of the Cash Happy report – a wider piece of research looking into the links between cash and happiness.

References

1. UCAS figures - as of midnight on 20 August 2015 - a total of 477,280 students have been placed in full time education including break down of age groups.

2. University loan data taken from Payback Time? Sutton Trust’s report into student debt.

3. Historical funding data taken from The Telegraph.

4. Relative prices/inflation data taken from Thisismoney historical inflation calculator.

Here's the information that you need to know about who we are and the other companies that we work with in order to provide our products and services.

Who are SunLife?

Phoenix Life Limited trades as SunLife and is the provider of the Guaranteed Over 50 Plan, SunLife Insurance and the life insurance policy payment option for Funeral Plans. Phoenix Life Limited’s registered office is at 1 Wythall Green Way, Wythall, Birmingham, B47 6WG (registered in England, no. 1016269). Dignity Funerals is not authorised or regulated for this activity by either the Financial Conduct Authority or the Prudential Regulation Authority. Dignity Funerals Ltd is a member of the National Association of Funeral Directors.

SunLife Limited distributes financial products and services and is a company limited by shares, registered office: 1 Wythall Green Way, Wythall, Birmingham, B47 6WG (registered in England, no. 05460862). SunLife Limited is authorised and regulated by the Financial Conduct Authority and is entered on the Financial Services Register (registration no. 769427).

You can contact us by post at SunLife, PO Box 1395, Peterborough, PE2 2TR or by phone on 0800 008 6060.

If you choose to add Funeral Benefit Option to your Guaranteed Over 50 Plan the funeral services are arranged and provided by Dignity Funerals Limited. Dignity Funerals Limited is a company registered in England and Wales No. 00041598. VAT registered No. 486 6081 14. 4 King Edwards Court, King Edwards Square, Sutton Coldfield, West Midlands, B73 6AP. Telephone No. 0121 354 1557. Fax No. 0121 355 808. Part of Dignity plc. A British Company. Dignity is not authorised or regulated for this activity by the Financial Conduct Authority or the Prudential Regulation Authority but is a member of the National Association of Funeral Directors.

Who provides the Funeral Plans?

Dignity Funerals Ltd arranges and provides the funeral services. Dignity Funerals is not authorised or regulated for this activity by either the Financial Conduct Authority or the Prudential Regulation Authority. Dignity Funerals Ltd is a member of the National Association of Funeral Directors.

The life insurance policy that pays for your funeral will be provided by Phoenix Life Limited, trading as SunLife.

Who provides My Smarter (ISA)?

My Smarter (ISA) is provided by Scottish Friendly Asset Managers Limited. Authorised and regulated by the Financial Conduct Authority. Details can be found on the Financial Services register, registration No. 188832. Member of The Investment Association. Registered Office: Scottish Friendly House, 16 Blythswood Square, Glasgow G2 4HJ.

Who provides the Will writing services?

Hugh James is authorised and regulated by the Solicitors Regulation Authority (SRA Number:303202).

The information contained on this website is based on Hugh James' understanding of the law of intestacy in England and Wales only as at April 2014. The law in Scotland and Northern Ireland is significantly different. This is for information purposes and is not intended to be legal advice.

Who provides Family Life Insurance?

SunLife Family Life Insurance is provided by Scottish Friendly Assurance Society Limited which is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Details can be found on the Financial Services register (registration number 110002). Registered Office: Scottish Friendly House, 16 Blythswood Square, Glasgow G2 4HJ. 

Who provides SunLife Pet Insurance

SunLife Pet Insurance is arranged and administered by BDML Connect Limited. BDML Connect Limited is authorised and regulated by the Financial Conduct Authority (No. 309140). Registered in England and Wales Number 02785540. Registered Office: 45 Westerham Road, Bessels Green, Sevenoaks, Kent, TN13 2QB.

Who provides SunLife Home Insurance

SunLife Home Insurance is arranged and administered by BISL Limited and underwritten by a panel of insurers. BISL Limited are an intermediary authorised and regulated by the Financial Conduct Authority. Registered in England no. 03231094. Registered office Pegasus House, Bakewell Road, Orton Southgate, Peterborough PE2 6YS.

Who provides SunLife Car Insurance

SunLife Car Insurance is arranged and administered by BISL Limited and underwritten by a panel of insurers. BISL Limited are an intermediary authorised and regulated by the Financial Conduct Authority. Registered in England no. 03231094. Registered office Pegasus House, Bakewell Road, Orton Southgate, Peterborough PE2 6YS.