gmitsu Handbook
Hey guys, Welcome to the GMITSU Finance Handbook. Given the huge upturn in financial difficulties being faced by students in light of the recent economic downturn and series of austerity Budgets, we have produced this finance guide, which we hope will provide students with all of the necessary information required to get through college in more difficult circumstances and tighter budgets. For those of you facing extreme difficulties in meeting your expenses in getting through college, such as rent, food and bills, you can apply to the Student Assistance Fund at Student Services, but must provide bank statements, receipts and outstanding bills. If you are feeling the pinch of the recession somewhat while trying to stay within your budget in getting through college, then you may find the second section on the “Top Ten Tips” for cutting the cost of college useful. One group of students who generally face more difficulties with finance in getting through college than any other demographic is mature students. That’s why we’ve included a full section outlining the different types of financial support available to mature students. As I’ve mentioned earlier, the adjustments made to the education budget in this year’s 6 billion euro cuts package announced in this year’s Budget have a range of implications for students it is important to be aware of. The full breakdown of Budget decisions affecting students directly is therefore also included in this booklet. We’ve also included It’s Your Money.ie’s guide to keeping your finances under control in college, a section on other ways to bridge a financial shortfall, and finally the GMITSU Financial Planner for projecting your income and expenditure over a given period. This planner along with the rest of the booklet will also be available for download from our website, www.gmitsu.ie. I hope you find this guide to be useful, and remember if you have any questions or difficulties with your finances, call down to us at the Students’ Union or get in contact with me by phone or e-mail and we’ll do our best to help. Joe O’Connor GMITSU Vice-President/ Welfare Officer suvpresident@gmit.ie 087-2191862
“INVESTING IN YOUR FUTURE” This fund is designed to tackle disadvantage by providing financial support to students in need of additional support to enable them to complete their studies SEPTEMBER 2010 Very limited funding available & applicants must be fully REGISTERED prior to applying. OCTOBER or NOVEMBER 2010 The 2010/2011 Fund will be available sometime in Oct/Nov. Applications can be picked up in the Student Services Office or requested by e-mail: studentservices@gmit.ie BACK UP DOCUMENTS REQUIRED AT APPLICATION STAGE All the following must be supplied when making application * 3 months bank statements * Grant letter or Proof of Income (for parents if student is under 23) * Recent Receipts or Outstanding Bills for: Rent, Transport, Books, Materials, Electricity/Heat, Food, Medical Expenses or Childcare For those requesting support for Childcare, copies of Children’s Birth Certificates & a confirmation letter from a Registered Childminder with the Names of Children & Cost per Month, are required.
Top tips to help you cut the cost of college By John Hearne
College is expensive. Whether you’re living at home or renting, you’ll find your money will disappear pretty quickly when you’re on a tight budget and paying for food, bills, travel, books and more. Luckily, a little know-how can mean the difference between finding yourself in debt and being able to afford a night out with your mates. The National Consumer Agency (NCA) offers ten top tips for making ends meet in college. 1. Budget. No one does it, but be the first and reap the benefits. It will help you see where your money is going and ensure you can afford the essentials. It can also show you areas where you might need to cut back. There is a handy budget planner on www.itsyourmoney.ie to help get you started. As well as making a budget, checking your account statements regularly will help make sure you have money to pay direct debits and standing orders so you can avoid expensive penalty fees. The Economiser on the NCA’s consumer rights website, consumerconnect.ie, is a good place to start if you want to compare your grocery, energy, TV and telecom and mobile phone bill spend to other households. This may identify further savings you can make. 2. Accommodation. For those not living at home, accommodation is a major expense. How much will you pay? Weekly or monthly? Are electricity and heating included? Is a deposit required? Will you pay cash or by electronic transfer? Unexpected heating bills or a five-week month can have a significant impact on your cash-flow, so it’s important to account for these eventualities well in advance. 3. Travel is another major expense. For those that live away from home, it’s important to factor in the cost of travelling home, even if it is just to get your clothes washed. For students in bigger cities, the cost of public transport can add up quickly. There are substantial student discounts on offer on public transport (student travel card available from SU office). Take advantage of these where possible. Or get yourself a bike. 4. Banking. Choose the right student current account. Lots of banks will be trying to get you to open an account with them, so they’ll offer freebies to entice you. Try to look past the free flights or cash on offer, and focus on the fees and charges. Most student accounts are free of transaction fees, but this doesn’t cover overdraft fees, which can be expensive, so if you think you might use an overdraft, it’s worth choosing an account with the lowest fees. The National Consumer Agency (NCA) personal finance website, www.itsyourmoney.ie, has a handy student current account cost comparison, which will help you compare your options. 5. Food: Become a domestic god/goddess. Even if your college canteen is subsidised, you could end up spending as much as €50 a week on food, when you factor in snacks and drinks. If you cook for yourself, or make your own sandwiches, tea or coffee, you could save a fortune. If cooking is unexplored territory for you or beans on toast is your speciality, www.cheapeats.ie offers lots of helpful information, including money saving recipes, details of special offers in shops, and tips on using up your leftovers. 6. Credit: Don’t do it unless you absolutely have to. Most particularly, if you can avoid using a credit card, do. It’s the most expensive form of finance there is. But if this isn’t an option, then make sure you choose a credit card with a low annual percentage rate (APR). Remember your credit limit is not a spending target, so only use your card for essential purchases (no, a round of drinks is not an essential purchase) and try to pay your bill in full each month. When it comes to loans, again look for a low APR and try to borrow over as short a term as possible, that way you’ll pay less interest. If you’re not sure what’s on offer, check out www.itsyourmoney.ie for comparisons of student credit cards and loans.
7. Think before you spend. Don’t rush out and buy every book on your reading list on the first day. There will be lots of opportunities to buy second-hand books and many of the books will be available in the college library. Socialising is obviously a key part of the college experience, but it can be easy to spend more than you anticipated. Try to go east at the beginning. Balance the temptation to go to everything in the first few weeks against the necessity of having to pay for it rest of the year. 8. Discounts: Lots of shops will offer discounts to students with a valid student ID card, so it’s always worth producing your card at the till. It also entitles you to over 200 discounts nationwide including restaurants, entertainment and much more. Log on to www.studenttravelcard.ie to find out more. However, don’t be dazzled by discounts, no matter how tempting they seem. You’ll only save money if you were planning to buy it in the first place! 9. Maximise your money. If you worked during the summer, you could be entitled to claim tax back. The forms can be downloaded from www.revenue.ie . A part-time job will boost your income, but could mean less time for studying and socialising, so you’ll need to weigh up your options carefully. It’s a good idea to wait until you get your timetable before you apply for anything, so that you’re sure of how much free time you have. You could also be entitled to a grant. For detailed information on grants and funds for students, log on to www.studentfinance.ie. 10. If you need help, get it. If you are having money worries, look for help as soon as possible. You can talk to your student welfare officer, or, if you are having problems making repayments on a loan or credit card, contact your bank to explain your problem. Mabs, the Money Advice and Budgeting Service is also a great source of independent advice for those who find themselves in hot water with money. Whatever you do, don’t ignore the problem, it’ll only get worse. And remember, missed repayments will affect your credit history and could mean difficulty getting loans in the future.
Mature Students Information Free Fees Initiative
This is a state sponsored scheme. The state pays for the tuition fees of eligible students who are attending full-time third level education for the first time. Learners must be taking a full-time course that is more than two years in duration and they must be an EU national. However you may have to pay a Student Service Charge (Student Registration Fee). If you meet the criteria to have this paid for, you must submit a grant application form. This applies even if you will not be eligible to receive the maintenance grant. Non-Irish nationals should visit www.education.ie to find out if they meet the eligibility criteria. The Free Fees Initiative only applies to full time courses, if you intend on taking a degree part time, then you will be required to pay full fees. The government recently announced a number of free places in further and higher education. These Labour Market Activation Measures include a number of free places in third level institutions; visit http://www.aontas.com/information/accessmeasuresm.html to find one near you.
Higher Education Grants
These grants are administered by your local VEC or local authority. Check with GMIT whether it is the VEC or local authority who is administering your grant. A Special Rates Maintenance Grant also known as the Top Up grant is also available to more disadvantaged students in further and higher education. Full details and application forms are available on www.studentfinance.ie
The Student Assistance Fund
This is specifically aimed at students that are experiencing financial hardship while in college. Students are recommended to contact the Students’ Union or Student Services.
The NOVA Fund
Nova stands for the National Office for Victims of Abuse. To date €12.7m has been made available to provide educational programmes to Former Residents and their families. This fund is being administered through NOVA, application forms can be obtained from NOVA and you, your spouse and your children may qualify for funding under the Criteria of Eligibility that has been set down by the committee. Contact NOVA on 1800 252524
St Vincent De Paul
This organisation provides financial assistance for education and training. Applicants can apply to the Education Officer in the Society of St. Vincent De Paul. In order to apply applicants need to enclose a letter, outlining what they are studying and what factors are inhibiting their studies. Generally this fund is reserved for learners who have not been successful with other agencies. For further information see www.svp.ie
Tax Relief
Tax relief can be claimed on tuition fees up to a maximum fee limit of roughly €5000. Learners can claim up to 20% of course fees back through tax relief. Applicants are advised to contact their local tax office in relation to this and to note that the course must be delivered through or in conjunction with approved institution. To get a full list of approved courses students should visit www.revenue.ie
Back to Education Allowance
The Back to Education Allowance (BTEA) allows people in receipt of certain social welfare payments to retain those payments whilst participating in approved full-time courses in further and higher education. Qualifying payments for BTEA include Job-Seekers Allowance, Job-Seekers Benefit, Farm Assist, One Parent Family Payment, Disability Allowance and Carer’s Allowance. The Back to Education Allowance replaces an applicant’s existing social welfare income and, in addition, participants qualify for an annual €500 cost of education allowance. The cost of the Student Registration Fee will also be met by the Exchequer on behalf of BTEA applicants, but they must submit an application for a Higher Education Grant. You can apply for the Back to Education Allowance under a number of different categories including second level and third level. For more information on categories and the Allowance in general visit www.welfare.ie. The qualifying period to access the allowance was recently changed to 9 months for those on a social welfare payment and who want to do a 3rd level course. People awarded statutory redundancy may access the scheme immediately, provided an entitlement to a relevant social welfare payment is established prior to commencing an approved course of study. Budget 2010 eliminated the dual entitlement to the Back to Education Allowance and the maintenance grant for further and higher education students entering a new programme. From 2010-11, eligible students entering a new course of study in higher education can apply for BTEA or the maintenance grant, but not both. Please note that if you are eligible for the BTEA and not the Maintenance Grant, you must still apply for the Maintenance Grant in order to have your registration fee paid for. For certain social welfare payments (e.g. the lone parent allowance), you can continue to receive the same social welfare payment (and not the BTEA), and be eligible for a maintenance grant. Please contact your local welfare office and explore which is the better option for you, as various allowances may also be affected. This will not apply to those in receipt of the Jobseeker’s Allowance. For more information on this scheme visit www.welfare.ie
The Budget’s Impact My Grant
The amount you recieve will be cut by 4%, effective immediately. This includes the 2nd and 3rd installments of the Grant for this year. The distance you must travel to qualify for the non-adjacent rate has almost doubled. From 2011/12 students must now travel 45km instead of 24km to recieve the higher rate. This will include students already in receipt of the grant, and takes effect from the beginning of the 2011/2012 year. GMIT SU is lobbying local TDs strongly on this issue. There will be a new income band taken into account. Students with family incomes between €51,381 and €55,920 will qualify to have 50% of their Reg fee paid. Levels of Grant (Non-adjacent)
2010/11 Rate
2010/11 After Budget
Difference
Proposed 2011/12 Rate
SSC Only
SSC Only
SSC Only
SSC Only
Level 2 - 25% Maintenance
€810
€783
-€27
€778
Level 3 - 50% Maintenance
€1,625
€1,571
-€54
€1,560
Level 4 - 75% Maintenance
€2,435
€2,354
-€81
€2,338
Level 5 - 100% Maintenance
€3,250
€3,143
-€107
€3,120
Level 6 - 100% Maintenance + Special Rate
€6,355
€6,145
-€210
€6,101
2010/11 Rate
2010/11 After Budget
Difference
Proposed 2011/12 Rate
SSC Only
SSC Only
SSC Only
SSC Only
Level 2 - 25% Maintenance
€330
€319
-€11
€317
Level 3 - 50% Maintenance
€650
€629
-€21
€624
Level 4 - 75% Maintenance
€980
€948
-€32
€941
Level 5 - 100% Maintenance
€1,300
€1,257
-€43
€1,248
Level 6 - 100% Maintenance + Special Rate
€2,545
€2,461
-€84
€2,443
Level 1 - No Maintenance
Levels of Grant (Adjacent) Level 1 - No Maintenance
The Reg Fee
The Student Services Charge, or Reg fee, is set to rise to €2,000. This rise only applies to the first child in a family paying the SSC at any one time. Additional children will pay the current €1,500 charge. From 2011/12 the charge will be renamed the “Student Contribution”. USI is working hard to ensure that this charge will be payable in installments.
Where I study Your place of study will recieve a 7% reduction in income this year, including a 5% reduction in its non-pay budget. This will directly affect the provision of frontline services, such as your Library and Student Health service.
Mature Students Mature students will no longer automatically qualify for the non-adjacent rate of the grant, and will have to also meet new criteria (Having a place of residence over 45km from place of study). This change effects both new and existing applicants.
PLC Charges A new charge of €200 will be introduced for students in PLC courses. This charge will be paid by the exchequer on behalf of students in receipt of grants or the BTEA.
Graduate Employment It has been announced that a graduate internship programme is to be launched in the public and community/voluntary sectors creating 15,000 graduate placements. The programme is much in line with USI’s proposals on graduate employment. Further details are expected in the coming days. Check www.usi.ie or www.gmitsu.ie.
Tax Relief
Tax relief for student charges and fees will be curtailed also - there will be no tax relief on the first €2,000 of charges for full time students, the first 1,000 for part time students. In essence it means that a fulltime postgrad student will loose €400 and a part-time postgrad will loose €200 in relief against their fees.
What isn’t clear?
If you have any queries about the budget, and how if affects you, contact GMIT Students’ Union. They provide a range of services to help you through your time in education, and may be able to assist you in recieving financial supports.
CONTACT US FOR MORE INFORMATION ON THE BUDGET’S IMPACT: Colin Canny GMIT SU President Email: supresident@gmit.ie Phone: 091-742055 / 086-3473284 Joe O’Connor GMIT SU Vice President & Welfare Officer Email: suvpresident@gmit.ie Phone: 091-742316 / 087-2191862
Keeping your finances under control It can be hard to keep your finances under control when you’re in college, especially if you don’t have a regular income and you are on a tight budget. Managing your money will take a bit of effort at first, but it is worth it in the long run. * Make a realistic budget * Choose your account wisely * Be careful with credit * Tackle debt straight away * Manage your bills * Money saving tips
Make a realistic budget
If you are living away from home, rent will probably be your biggest expense and you’ll need to carefully plan how much it will cost to live every month. Even if you are not renting, you will probably have lots of additional expenses and making a budget and sticking to it is the best way to avoid running out of cash and having to borrow money. If you receive a lump sum, for example a student grant every term, work it into your monthly budget and stretch it out over the term. Itsyourmoney.ie’s handy budget planner can help you plan your budget and gives you a breakdown of your spending, so you can see where you may need to make changes.
Choose your account wisely
If you are just starting off college you may want to open a bank account. Student accounts usually have no transaction fees, such as ATM withdrawal fees or standing order set-up fees. However, there is an annual Government stamp duty on ATM cards, debit cards and credit cards. Check out the Revenue website for up-to-date figures. Many providers will offer you freebies, such as phone credit or free flights, to encourage you to open an account with them, but look at all the fees and charges before you open an account.
Some other things to compare:
* The networks of branches- are they easily accessible for you? * Access to your account- do they offer internet and phone banking? * Additional benefits, such as a ‘no-fee graduate account’ when you finish college * If you plan to get an overdraft, compare the overdraft fees charged by each provider and the penalty fees that apply if you go over your limit. You can compare these charges in itsyourmoney.ie’s student current account cost comparison.
Be careful with credit
Credit cards are a convenient way to pay for goods and services, for example booking tickets or flights online. If you are thinking about getting a credit card, you should compare the different terms and conditions and look for a low APR - check out itsyourmoney.ie’s student credit card cost comparison. Be careful how you use your credit card- your credit limit is not a target . If you use it too much, even for small things, and don’t pay off what you owe, debt can mount up quickly. Before you use your card to buy something, ask yourself if you can really afford it. Try to pay your bill in full each month, or else your balance owed can build up very quickly, leaving you in debt. Some banks may offer you overdrafts or student loans. But before you consider borrowing money, you should see if you can save to pay for what you want. If you do need to borrow: * don’t borrow more than you can afford to repay. Itsyourmoney.ie’s loan calculator can help you work out what you can afford; * aim to pay the money back in as short a time as possible, based on what you can afford; and * look for a loan or credit card with the lowest annual percentage rate (APR). Itsyourmoney.ie’s cost comparisons can help you compare the student loans and travel loans on offer. You can also contact your local credit union to see if they are offering loans to students.
Tackle debt straight away
If you find yourself having difficulties making loan repayments or trying to pay off credit card debt, don’t ignore the situation. If you miss repayments, it will affect your credit history and might prevent you from getting a loan in the future. If you think you may have trouble making repayments, get in touch with your lender immediately. Itsyourmoney.ie’s debt action plan explains the steps you can take to tackle the problem.
Manage your bills effectively
You can pay your regular bills by standing order, direct debit or credit transfer. Check your account regularly to make sure that you have enough money to meet these bills. If you don’t you may have to pay a penalty fee.
Money saving tips
* Save on your utility and phone bills - the Power of One site has lots of energy saving tips to help you cut costs. And you can save money on your mobile, by comparing costs on the Comreg site callcosts.ie. * Look for student discounts and try buying online – many shops offer discounts for students with a valid student card, so it’s worth asking. And try buying online, you’ll often find better deals on clothes, music, books etc. * Save on your grocery bills - check advertisements for regular special offers and check out our ConsumerValue section for more information on saving money on groceries. Make a list of your meals for the week and stick to it, and use all the money off coupons you can get your hands on. * Claim your tax –you may be entitled to a tax refund if you worked over the summer. You can get more information on the Revenue website.
How to bridge a financial shortfall It is ideal to project your budget for the coming year by creating an ‘Income & Expenditure’ spreadsheet. Talk to your parents or partner and discuss how much financial help they give you throughout the year. However many students may not have financial help from the parents, guardians or partners. Whatever your shortfall is, there are many ways to bridge the gap. • Part-time job (Make sure you have an up-to-date CV with details of previous work and educational experience). For useful tips on writing a CV, please contact the Careers Office (through Student Services) • Self-Employment—Do you have qualifications/skills/talents that you can use to earn extra cash? If so, advertise around campus and surrounding area. E.g. Grinds, Music lessons, sports coaching, crafts, etc... • Scholarships—Many Universities offer students academic, access or sporting scholarships which can help towards the cost of living (contact the Students’ Union for more information on scholarships).
Money Not Your Thing? If money is not your thing - Give this booklet to your parents. They will need to know how much it will cost for you to go to college. If you are an independent student and you are unsure how to budget for the year - Call into the Students’ Union and speak to Joe if you need any assistance. You can also browse the following websites: www.itsyourmoney.ie www.studentfinance.ie www.mabs.ie
GMIT SU FINANCIAL PLANNER
Compiled by Joe O’Connor GMIT Vice President & Welfare Officer
GMIT Students’ Union, 2011