While everyone seems to be focused on getting kids back to school this month, less thought has been given to the estimated 246,000 students starting or returning to third-tier institutions across the county.
While the housing situation, or lack thereof, is on everyone’s minds (more on that next week), paying for everything else is something that keeps all third-tier applicants, and their parents, busy. .
This week I look at the types of loans and support available from banks and others to help with the range of extra expenses for everything needed, from books to transportation to all-important social life and yes, housing.
Compared to some other countries, including the UK and the US, the third and fourth tier costs here are relatively inexpensive. But tell that to the thousands of people returning this month who are wringing their hands wondering where the money will come from at a time of rising household spending and runaway inflation. Here is what is available to facilitate the financial journey to higher education.
It is not too late to apply for a Student Universal Support Ireland (Susi) scholarship. Although preference is given to early applicants, the state scholarship system, which awards half or the full student contribution (€3,000) and/or a monthly maintenance grant, remains open. More than half of all students pass because the means by which it is tested are reasonably generous. You don’t need to know your grades, your courses, or even your college education. See susi.ie.
Student bank loan
Anchor banks and credit unions are the main port of call for specific student loans. While both major lenders may seek or require collateral i.e. an adult backer, applying for the loan as a student rather than a parent often makes sense as interest rates are lower.
The AIB has a “student contribution loan” of €3,000 per year over three or four years of a course, costing 8.15 to 8.45 pc per year, repaid only on the basis of interest while studying, full payments beginning only upon graduation, repaid over the after five years. He warns that the loan will cost more as a result, but these are still better terms than other types of loans.
The Bank of Ireland charges just 5% a year over five years for its student loan, which is capped at €5,000 for university-related expenses. You can defer repayments for the first three months.
It offers graduate loans from €2,000 to €5,000 over one to five years, also at 5 pc. And their post-graduation loan can go up to €10,000 with a deferral over the first 12 months.
This is for one-year courses, like a master’s, and costs 5.6pc. But the long postponement takes the immediate pressure off.
In all cases, interest rates are variable, so they can increase. Conversely, you can refund or overpay without penalty as a result.
With interest rates capped at 12% per annum – this will change soon – most credit unions offer reduced rates for student loans. You may need proof of the course.
A €10,000 loan borrowed over five years at a typical rate of 7.63pc would cost €201 per month.
Many also run scholarship programs and grants for members, either on a lottery basis or with proof of Leaving Cert and exam results.
Becoming a member is easy, it makes future credit research easier, and you can get started with just a few dollars.
Help for students
The Student Aid Fund is designed to provide financial support to students who experience difficulties during their college education. They can apply in addition to the Susi Grant, and it aims to help with the provision of books, food, essential travel and rent.
It does not cover tuition fees or loan repayments. Students taking approved full-time or part-time NFQ courses (levels 6-10) can contact their college’s access office or student services. Some have a deadline, so it’s worth getting there early. You may need supporting documents, such as proof of your or your parents’ income and receipts for certain bills.
Back to Study allowance
For recipients of certain social allowances, unemployed or single parents or disabled, and returning to study, a weekly allowance is paid equal to their level of allowance, so as not to suffer financial loss. If you have a dependent child, you can receive €500 per year for tuition fees.
In this decade of centenarians, a scholarship commemorating the birth of the nation seems appropriate. This is not new however, but an annual stipend is available to anyone from certain minority groups with low levels of higher education participation, including the economically disadvantaged, traveling community members, survivors domestic violence or the healthcare system, for example.
Former full-time caregivers and refugees are also included, as are former inmates. This is called the “second chance” scholarship.
Although means-tested (you must also be eligible for Susi), it pays between €1,500 and €5,000 per year to successful undergraduate and postgraduate applicants. It is in demand at colleges, but see www.hea.ie for more information.
Tuition Tax Relief
Tuition waiver is available at 20% on expenses up to €7,000 per course, per person, per year.
Waiver is only granted on the fees themselves, not on additional expenses such as course materials or company memberships.
There is no consideration for the first €3,000 (or €1,500 for a part-time course), but this is a limit per family, so if there is more than one no one in full time teaching, definitely worth claiming.
You can only apply for courses approved by Revenue, but most Irish universities, private and public, are included. See revenue.ie for a full list, or ask the college.
John is doing a full-time Masters which costs €8,000 for one year. He can claim tax relief on €4,000 of this amount (€7,000 minus €3,000), which would result in a tax relief of €800 (€4,000 x 20 pc).
Mary pays school fees for her children Padraig and Emma who are both in tertiary institutions.
Padraig fees are €9,000 per year at a private college for a four-year L8 degree; Emma pays €3,500 for a part-time L7 course. The qualifying fee is €7,000 for Padraig (the maximum allowed) and €3,500 for Emma, making a total of €10,500. The initial €3,000 is not taken into account.
The total abatement on the remaining €7,500 is €1,500. Tax relief is applied through Revenue’s ROS or MyAccount.