should i take maintenance (or any) loans if not needed at first?

sfe deadline is coming up and i've seen lots of mixed opinions on maintenance loans? plan was that i have a set amount saved up already for uni and when it runs out then i would take out loans, so that i have less debt overall after not having taken them (and interest associated) every year and only the years i needed(?)

however i'm a little confused about maintenance loans; some people have said that i should take them for various reasons; i don't have to use them and it's good to keep them, i can save them up for later, etc. and others say it's still more debt not needed if i don't necessarily NEED them at first (even if the interest isn't as intense as student loans)

are there any obvious pros or cons to taking a maintenance loan (or loans in general) if you don't necessarily need them at the beginning of your degree?

Reply 1

normaw

Volunteer Section Leader, Clearing and Applications Advisor

Original post by universtar

The difference between normal loans and student finance is the way they are repaid. If you were eligible for and took the maximum maintenance loan and tuition fee loans for three years that would be roughly £60k. If you took just the tuition fee loan, that would be around £28k. However, when you start work after graduation, whichever scenario you choose, you would repay the same amount back each month as the repayments are based on income not how much you have borrowed (repayments are 9% of anything you earn over £25k per year). Normal loan repayments are based on the amount you borrow, the interest rate and the repayment term.

Nobody can tell you whether you should take the maintenance loan or not. The repayment term is now 40 years so new students are likely to pay more for their degrees than previously. But a lot depends on what you will earn and very few people can predict that. Taking the maintenance loan means that you could put your savings to 'better' use, such as saving for a deposit for a home when you start work.

I'd recommend you read the following article that explains the pros/cons in more detail:

https://www.moneysavingexpert.com/students/student-loans-england-plan-5/