New research from the Institute of Inertia – a partnership between the University of Sheffield and – reveals the significant financial issues faced by UK university students, with over half spending their entire student loan before the end of term; a quarter slipping into their overdraft during this time; and a staggering one in ten spending their entire student loan within the first two weeks.


Does this sound familiar?

Our new research – which polled both students and parents of students - reveals that this is likely to ring bells for many of you, whether it mirrors your own situation or that of a student you know.

Despite the appearance of their bank balance by the end of term, almost 90% of students stated that they felt confident in their ability to manage their finances effectively. So, where is the disconnect?

Dr Thomas Webb, a social psychologist at the University of Sheffield and Chair of the Institute of Inertia, suggests: “This finding likely attests to the often-cited 'gap' between peoples' good intentions -  in this instance, to make their money last – and taking action.”

As a result, he indicates that more needs to be done to help students, adding: “The findings also point to the need for strategies to support students, with University often the first time that they gain financial independence. The Student Loans Company's policy of providing the loan to students for the first term in one lump sum no doubt contributes to the difficulties that students face in making their money last.”

Clearly, the majority of parents agree; over half believe that their children would benefit from additional financial guidance. In addition to this, some of the students polled highlighted that an alternative form of payment could improve their finances; four in five of them stated that they would rather receive their maintenance loan in smaller and regular instalments, as opposed to one lump sum.

For most however, it became clear that the maintenance loan provided wasn’t enough, with over two thirds of students today relying on the ‘Bank of Mum and Dad’ for financial support.

Echoing these beliefs, Jody Baker, Head of Money at, comments:

“For many new students, their first student loan deposit is likely to be the most money they have received at one time and while a majority say they feel confident managing their finances, their bank balances at the end of the term or the need to rely on the ‘Bank of Mum and Dad’ state otherwise. What’s more worrying is that parents think that their children would benefit from financial advice yet many aren’t leading conversations in this area – a small move that could make a big difference to how money is managed during term time.”

Know someone who could benefit from some simple tips and advice on how to maximise university finances? Watch the video below for some expert guidance from Institute of Inertia panellist and financial expert, Jasmine Birtles.