London students grapple with money despite the city being more affordable than last year

One in five worry about homelessness while there’s been a reported ‘drastic improvement’ in living costs


According to a new report by NatWest, there’s been a “drastic improvement” in the ratio of living cost over income for London students over the past year.

This ratio, called the Student Living Index by NatWest, surprisingly fell by 22 per cent nationwide, suggesting students are spending less of their income on basic expenses. This comes as students reportedly earn 65 per cent more while living costs only rose by 29 per cent.

But despite these reported improvements, London students are still “heavily concerned” about their finances. Other sources have suggested that 20 per cent of students in Greater London fear going homeless and 95 per cent of students in UCL alone worry about their finances in the coming year.

Ranking of Student Living Index from the most expensive cities to the least (Credit: NatWest)

NatWest calculates the Student Living Index by dividing monthly living costs (i.e. rent and bills) by the average monthly income.

In London, this figure is 0.77, meaning students spend around 77 per cent of their income on living costs on average. This made London fall from the podium of the most expensive cities for students in the country, and Natwest has described this as a “drastic improvement.”

The report continued to show that London students spend less of their student loans per month on living expenses than the national average. But they are also 88 per cent more reliant on the bank of mum and dad, receiving more from their parents than any other city in the country.

‘I am heavily concerned’

While the index suggests London has become more affordable, many students don’t think this reflects the situation on the ground.

Recent research by the National Building Society shows that one in five students in Greater London worries about going homeless in the next six months, higher than the nationwide average of one in seven.

An Instagram and Facebook poll by Students’ Union UCL also found that 12 per cent of students at the uni have had to use a food bank during their programmes. This figure is around 11 per cent nationwide, according to a National Union of Students (NUS) survey.

UCL student Jesse* told The London Tab: “I am heavily concerned, [because while] student finance loans stay the same, prices are skyrocketing.”

Eli*, who also goes to UCL, echoed this: “With living costs rising further this year, I worry about how I’ll have to stretch my maintenance loan to go further.”

An increasingly big part carved out of student and maintenance loans is rent and bills. It’s estimated the average maintenance loan will soon fail to cover a third of student accommodations‘ rent. And another current student has told us because their bills have “shot through the roof,” they “have to sacrifice things [they] would normally need.”

They are just a part of the 88 per cent of U.K. students who have had to make lifestyle changes in response to the increased cost of living.

‘I don’t think there’s increased income at all’

One of the major issues students think they face is how little their incomes are compared to the living cost in the capital.

Morgan*, a current UCL student, told The London Tab that they “don’t think there’s increased income at all.”

“A lot of jobs pay £9-£10. That’s the same amount of money I was paid in Manchester. I find that a bit absurd considering rent in Manchester for a room is around £450 and in London, it’s £1,000,” they said.

Their situation is not an isolated one. The NatWest investigation found that London students have the second-lowest term-time income compared to the 20 cities sampled and work the least amount of part-time jobs due to long commutes and fierce competition for any opportunities.

Average wages of students in London are only higher than those in Edinburgh (Credit: NatWest)

Alex*, a KCL student, feels “quite concerned, especially because I cannot work full time until the end of my studies.”

Flynn*, who studies at another zone one uni, also said: “I have not worked during the first two years of university. But given how much I have to spend this year and over the last few months, I am now looking for a job because I don’t want to rely on my parents for more than they can give me.”

It appears that the 65 per cent increase in average term-time income suggested by NatWest doesn’t seem to apply much to London students.

‘I don’t feel like the university is supporting me’

The financial strain has also been shown to impact student wellbeing. The UCL SU poll revealed that 94 per cent are worried about affording next year, and 87 per cent said this had affected their mental health. This second figure is 92 per cent for students U.K.-wide, according to the NUS.

Despite this, the NatWest report showed that one in four students feel they have no support from their unis regarding the ongoing cost-of-living crisis.

Peyton*, who is a recent UCL graduate, said: “I don’t feel like the university is supporting me.

“Though I appreciate the slightly lower prices in the cafés run by the Student Union, and if I lived in Central London, I would use them more regularly. Furthermore, the university career service was completely useless to me,” they said.

The situation is even direr for international students. In addition to the sky-high tuitions, a UCL student said they “don’t really get any support from the university” since they’re “not British.”

“European and international students are quite left for themselves in London,” they said.

26 per cent of students feel “very dissatisfied” with their university’s supports in terms of finances (Credit: NatWest)

In response to the students’ comments, a UCL spokesperson said: “We are aware that many students are worried about the cost of living and their finances, and we have been working on this through the summer with colleagues at Students’ Union UCL.

“We have already taken steps to ensure all students have information and advice about our direct financial support, which helps to fund studies, our financial assistance fund, that supports living costs, as well as short term loans for students who experience a delay in their normal funding.

“A team of dedicated Student Funding Advisers is also on hand, to offer support, advice and guidance to students. We will be sharing further information with students before the start of term about additional support that will be available to them and other actions we will be taking. We are also working with the sector to attempt to secure additional support from Government.”

London fortunately ranks quite low in terms of students not being supported by unis on finances, being 12 per cent lower than the national average (Credit: NatWest)

It’s clear that despite any improvements cited in the NatWest report, many London students are feeling the weight of the cost-of-living crisis with their budgets stretched thin.

An NUS spokesperson has said: “Without intervention, we fear that no amount of budgeting and saving is going to stop students from falling into poverty this autumn.”

*names changed to preserve anonymity

Related stories recommended by this writer:

Here’s how London unis are ranked for supporting student mental health

Over half of the general public don’t think university is good value for money

Meet the London student who wore an ‘I want a refund’ banner to her graduation ceremony