Can you afford to study at university?

Can you afford to study at university?

This article may be out of date. Please refer to the Good Universities Guide blog for the latest updates in the tertiary sector.

There's been a lot of press recently about what the federal government's changes to university tuition fees and HELP loan repayments will mean for those of you intending to study at uni. In short, education is going to get significantly more expensive.

The most important thing as a future student is to carefully research your study options – think about your interests, skills and career goals, and the outcomes you are hoping to gain from going to uni. Even if you're still at school, it's crucial to think about your education as an investment, and, as with all investments, consider which course is most likely to maximise your success.

To help you make a considered choice, we answer the following:

What changes can you expect to see?

Put simply, the federal government has put forward plans to deregulate (uncap) undergraduate tuition fees. This will allow public universities to set their own fees as high or as low as they want, just like private universities. Currently, public universities charge Commonwealth Supported Place (CSP) students one of three maximum contributions for each year of full-time study, making them an affordable choice for even the most exclusive fields of study.

A further blow to students comes through changes to the HELP loan repayment scheme, with students set to pay around six percent interest per year on their loans ” roughly double the current rate, which means your education debt will grow faster. See How the Federal Budget will affect tertiary students for more information.

How much can you expect to pay for your degree?

Industry commentary suggests that fees are likely to increase significantly. Two reports released this week by the National Tertiary Education Union (NTEU) and the National Centre for Student Equity in Higher Education (NCSEHE) have found that public universities will need to raise tuition fees by an average of 33 percent in order to maintain the same level of funding they have received under the current system. According to the NTEU, disciplines hit the hardest are likely to include:

  • agriculture – 45 percent increase
  • engineering and surveying – 66.8 percent increase
  • medicine, dentistry and veterinary science – 38.8 percent
  • social studies – 72 percent increase
  • visual and performing arts – 55.7 percent increase.

The NTEU has also expressed concern over the true cost of student debt under the new deregulated system. Using accounting as an example, it is estimated that the average student will graduate with a debt of around $75,000. Assuming that the graduate begins work on a salary of $45,000 that rises to the low $90,000 range within a decade, they would pay around $99,000 in debt over 23 years, which includes close to $25,000 in interest.

A further concern is the effect on graduates who take a career break, such as women who take time off to have and raise children. The NTEU estimates that this same accounting graduate could face costs as high as $120,000 (with $45,000 in interest) should they take a five-year break. Basically, any time you're not earning money – if you go travelling after you graduate, take an unpaid internship, or even go on to postgraduate study – your debt will keep growing.

Is there any good news to higher fees?

If fees rise considerably, this could see universities ˜up their game ' in order to be more competitive. With higher fees, universities would be more likely to work hard to provide high-quality teaching and course content. This would ensure students feel that they are getting value for money and a good return on investment (ROI) if they opt for a high-cost course – think better access to facilities and equipment, greater provisions for international study and work placements, and more solid employment outcomes.

And don't forget, depending on which data you look at, as a university graduate you are likely to earn up to 75 percent more than those workers who only completed Year 12.

What is return on investment (ROI) and why does it matter?

ROI should be front of mind for future students. This is why early and careful research is so important. For example, looking at the latest ratings from The Good Universities Guide, you can see that in some fields – such as communications, tourism and hospitality, or architecture – you need to know what to expect while you're studying and once you're trying to make it in the workforce. The table below shows what university students think of their university experience and how they fare after graduation. It also shows how many students did not stick with their degree past the first year (remember – you will still face a HELP debt if you do not complete your course).

Course experiences and graduate outcomes

Course experiences and graduate outcomes table

* Percentage of school leavers admitted on the strength of an ATAR score who do not continue to the second year of their degree.

Why it's more important than ever to think about your university choices

Whether you're thinking about going to uni, heading into the VET sector or getting straight into the workforce after school, you really need to do your sums and research your choices carefully. We suggest thinking about the following:

  • What are your goals for the future? What career do you want to pursue and what education and training do you need to get there?
  • If formal training is required, how good is the institution you are considering? How does it deliver courses? Is the teaching quality up to scratch? Are the facilities of an appropriate standard?
  • What are the graduate outcomes and student satisfaction of students at the university you are considering? How will the university support you in your progression into the workforce?

You can research all of the above using our Careers, Courses and Ratings sections.

If you're worried about covering the costs of your education, don't forget to seek out scholarships and allowances that can help you finance your studies. Even if you take out a HELP loan with the intention of deferring your fees, your course may require you to purchase textbooks or special equipment or materials, you might need to live away from home or you may decide to head overseas for an international experience. Scholarships are offered by the government, institutions and private organisations. They come in all shapes and sizes, from academic scholarships based on your ATAR that will cover the full cost of your course to smaller stipends that help you get set up in your new home if you've moved away from home to study. Use our Scholarship search to explore your options.

Finally, if you're still unsure about taking the plunge into tertiary study, you could try before you buy and take a Massive Open Online Course (MOOC) – there are thousands available, all free of charge and with no entry requirements.

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