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Getting a Degree: Understanding Your Finance Options

28 October 2021   |   by Explore Careers

Thinking about getting a degree? Fantastic!

University degrees offer a strong foundation of knowledge and build various skills that will set you up nicely for joining the workforce. It’s also a chance to immerse yourself in a topic you’re passionate about while taking those first steps into independent young adulthood!

But degrees cost money – a lot of money.

There’s lots of help out there to support young people as they take this first step into their potential careers, so we wanted to give you the big picture view of what finance options exist to help you on your way.

First Things First: What Costs are Involved?

When planning to study at university, it’s essential to think about all the costs involved. This can include:

  • Tuition fees
  • Living costs (such as rent, food and bills if you move away from home)
  • Study costs (such as subscriptions, textbooks, student memberships etc.)
  • Social expenses (such as personal subscriptions like Spotify or Netflix, as well as going out with friends)

Especially if you’re planning on moving away from home to study, it’s worth spending some time budgeting and planning for all the different costs involved and how you might pay for them.

How Much Does the Average Degree Cost in Australia?

Students who are Australian Citizens are usually offered places on their chosen undergraduate degree programs through a Commonwealth Supported Place (CSP).

A CSP is a place at a university or higher education provider where the government pays part of your fees. This is a subsidy, and you don’t have to pay it back. Universities have a set number of CSPs, and sometimes additional entry requirements need to be met to be offered a place.

You can expect to pay anywhere from $12,000 to $55,000 for an undergraduate degree on a CSP.

The lower range is for three-year degrees within the arts or sciences. The higher-end includes subjects like law and medicine – both of which require more than three years of study to become fully qualified.

Private universities usually don’t offer CSPs, and students are offered their undergraduate degree placements on full-fee paying placements. This means students are responsible for the total cost of their tuition, which can range between $15,000-$33,000 per year of study.

What are HELP Loans?

Whether you secure a CSP or full-fee paying placement, there are finance options to help remove the pressure so you can focus on your studies!

The federal government provides a couple of different loans that allow students to defer all or part of their tuition fees until they earn a certain level of income. You’ll then start paying back your loan directly from your salary.

The two most common loans to get are:

  1. HECS-HELP: This loan is available to students who receive a CSP at their chosen university. The loan covers the remaining portion of your tuition fees, not subsidised. These loans are available at public universities and in selected courses at private institutions. You need to be an Australian citizen to be eligible for this loan type.
  2. FEE-HELP: This loan is available to students who receive a full-fee place. These loans are available at private institutions and public universities for postgraduate students only. You usually need to be an Australian citizen or hold permanent residency to be eligible for this loan type.

If you are eligible for a loan for your tuition costs, there are different ways you can make payments:

  • You can pay your course fees upfront and in full each semester.
  • You can make partial repayments during your course and pay the remainder when you are earning a set annual income that exceeds the minimum repayment threshold set by the government.
  • You can defer all your fees until you earn a set annual income that exceeds the minimum repayment threshold.

What are Bursaries and Scholarships?

There are many scholarships, grants, and bursaries that can help support you financially with your studies. They are offered by the Australian Government, education providers, and some public and private organisations.

Every university will have certain bursaries and scholarships available to both domestic and international students. These can be for anything from covering the cost of a new laptop to membership fees or monetary amounts to cover living costs.

It’s estimated there are more than 3000 bursaries and scholarships available across Australia. Once you know which university you’re going to study at, you can begin researching what they have available and start applying.

When Do You Start Paying Back Tuition Fee Loans?

You start making repayments against tuition fee loans when your income exceeds the minimum repayment threshold.

The compulsory repayment threshold for the 2021-22 income year is $47,014. This means you would only begin making repayments once your income exceeds $47,014. The amount you pay goes up with your income.

Repayment thresholds are adjusted each year to reflect any changes in average weekly earnings and based on your annual tax return.

Where to Find Out More

Deciding to go to university is a big decision, and there is lots to think about! Finances is only part of that decision. While it’s something you should think about, it shouldn’t be what stops you from pursuing your dreams if you know university is definitely for you.

Tuition fee loans and financial support help everyone get access to the higher education they want.

Some of the best places to find out more include:

  • Individual university websites: Especially for information on bursaries and scholarships and general tuition fee information.
  • Good Universities Guide: This site has lots of general information to help you learn more about the costs involved with university.
  • StudyAssist: A great website from the government on all things finance, not just for university but if you’re considering other study options too.
  • State Study Sites: Each city has a Study site associated with it to help you learn more about studying there, including advice on finance and tuition fees. You can find yours by Googling Study and then your chosen city. For example, StudyAdelaide, StudyMelbourne, or StudyPerth.

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