Parents fork out £2.8bn a year to plug university funding gap

Parents and grandparents are shouldering an unprecedented £2.8 billion a year to support students through university, as the soaring cost of higher education leaves families footing the bill.

New research shows that 71 per cent of parents are either contributing, or planning to contribute, financially towards their children’s time at university. The average outlay per family now stands at £8,723 annually. With more than 328,000 students enrolling in UK universities this year, the financial burden on households has reached a record high.

The pressure is being fuelled by a combination of rising tuition fees, which are set to climb by 3.1 per cent this academic year, and living costs that far outpace the uplift in student maintenance loans. As a result, families are being called on to bridge the gap, covering everything from groceries and rent to utilities and academic supplies.

For many, these costs are becoming unsustainable. Meanwhile, graduates themselves are leaving university burdened with debts of around £50,000 on average – the heaviest debt levels faced by any generation. Loan repayments can stretch across decades, casting a long financial shadow over young people’s working lives.

Kevin Mountford, finance expert and co-founder of Raisin UK, warned that the financial strain is not confined to students. “The rising cost of university doesn’t just affect students, it places real financial pressure on parents and grandparents who are stepping in to help,” he said. “At the same time, everyday expenses from groceries to energy bills are climbing, stretching household budgets even further.”

Mountford urged families to prioritise savings despite the pressures of rising costs. “Building up savings wherever possible is so important. It gives families the peace of mind that they can support their loved ones today, while still protecting their own financial freedom for the future.”

The figures highlight how the cost-of-living crisis is reshaping the university experience. Once regarded as a personal investment in a student’s future, higher education is increasingly becoming a collective financial undertaking for entire families, raising questions about how sustainable the current system is for parents, grandparents and students alike.

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Parents fork out £2.8bn a year to plug university funding gap