After a turbulent few years, the Class of Covid now has to contend with graduating into the worst cost of living crisis in decades
“I am worried that however hard I try to create a better future for myself, it will never be enough,” says Nina, a 21-year-old final year student at Cardiff University. As someone from a lower socioeconomic background, she’s already well-versed in how a lack of money can negatively impact your life. But as the cost of living continues to creep up, Nina says she’s “scared”.
Rising energy and food bills, an increase in student loan repayments, soaring rents, a national insurance hike and stagnant wages are likely to hit students hard, and final year students in particular will be facing the crisis head on after they graduate. It’s clear this is set to have a detrimental impact on students’ mental health: a Student Beans survey from last year found that 55 per cent of students cited financial worries as the main source of stress and poor mental health.
“I went to university to try and create a better future for myself, to stand myself in good stead and increase my chances of living a more comfortable life where I don’t need to worry about money as much as my parents have over the years,” Nina tells Dazed. She was always planning to do a law conversion after graduating, however, she won’t be able to afford the course without working “at least 20 hours” alongside it even if she takes a year to save up, making her question what to do next. “I think I may need to move back in with my parents after graduating and work for a couple of years in order to actually afford to pay for law school,” she explains.
Nina isn’t the only final year student whose post-graduation plans have been thrown into disarray. Anna, 23, who is studying a masters in psychology at Leeds Trinity University, was planning to find a flat in Leeds and go travelling after graduation. But, due to constantly increasing housing costs, she’ll be moving into her boyfriend’s parents’ house in Huddersfield instead.
“Because of rent prices, I will be moving to Huddersfield as I can work in Leeds and potentially receive a better wage but pay less rent,” she explains. “I’ll also be moving in with my boyfriend’s parents to save money to either do more travelling or to move into our own place.”
If all else fails, she says, she’ll have to move back to her mum’s house in a small town in Merseyside. “It lessens so many career opportunities for me as there are better options in the cities, but as rent is so high it’s just not possible,” Anna tells Dazed. “I really want to save to work abroad for a while but, because all my money is going towards just existing, it doesn’t seem as likely anymore, which is gut-wrenching as I've wanted to do this since I was a child.”
While final year students are rightly looking ahead to their post-uni lives, it’s important to note that the cost of living crisis has already begun and students are already being impacted. Students, the majority of whom are in their late teens to early 20s, will feel the brunt of the cost of living crisis. A poll of 1,000 people aged 16 to 24 by the Royal Society for Arts, Manufactures and Commerce (RSA) found that almost half (47 per cent) were unable or just about managing to make ends meet each month, or have an income that varies significantly each week or month. An earlier report from October by the cross-party think tank Demos found that on average, young people spend more than twice as much as older people on essentials like rent or mortgage and bills, equating to nearly £1,300 more per month.
“I really want to save to work abroad for a while but it doesn’t seem as likely anymore, which is gut-wrenching as I’ve wanted to do that since I was a child” – Anna, 23
Rising energy costs in particular have already started squeezing students. Alex, 25, who is studying digital design and advertising at the Northern School of Art currently rents privately with his partner, who is also a student. He says he’s had to be “a bit more careful” with money since it became apparent energy prices would be increasing drastically. “The main impact it has had already is mainly just a bit of added stress around how I spend my money,” he tells Dazed.
Alex isn’t alone. Anna, who lives alone in a one-bedroom flat, has already had to cut back on spending this year. “As I live on my own I pay for all of my bills by myself,” she says. “This was so much cheaper when living in a shared house with friends under a set price for all inclusive bills – now, most of the money I earn or receive from my loan goes on rent and bills.”
She says she’s had to budget “much harder” even with grocery shopping and transport costs. She adds that nights out have become much rarer, too. “My friends and I have had to find other means to socialise such as going for walks or having nights in,” she says.
Nina, too, says she has to “literally count every penny” she spends. “Let’s just say when those are your circumstances, you notice everything,” she says. “When you grow up poorer than the majority of people around you, you’re taught about the importance of money and how every penny is significant.”
While those with bills included in their rent payment won’t suffer the immediate effects of rising energy costs, they’ll certainly suffer at the hands of the government rebate scheme. To help with rising costs all domestic electricity customers will get £200 off their energy bills from October, with 80 per cent of households receiving a £150 Council Tax rebate from April. The catch? The former needs to be paid back.
“When you grow up poorer than the majority of people around you, you’re taught about the importance of money and how every penny is significant” – Nina, 21
“The £200 energy bill loan is far from a perfect solution,” says Tom Allingham, Head of Editorial at Save the Student. “Any student living in accommodation where their energy bills are included in their rent will receive no discount in October, but will have to pay an extra £40 a year for five years to help fund the scheme. And that's not to mention the final year students who'll have to stump up for more expensive energy from April but, in many cases, will move back in with their parents after graduating. This means several months of hefty bills, but no refund in the Autumn.”
The £150 council tax rebate isn’t any better. “The government seems to have forgotten that full-time students don’t pay council tax in the first place – a measure put in place because those at university struggle to get by even in normal times,” he says. “This means that they won't receive the £150 refund in April, despite still having to contend with rising living costs.”
He continues: “In short, the government urgently needs to reconsider its proposals to provide some meaningful support for students, a group that has so often been an afterthought for those in power."
It wouldn’t be the first time. Students have had their lives ruled by uncertainty since the pandemic began in March 2020. After years of ‘hybrid learning,’ being trapped in halls and essentially ignored by the government, final year students now have to contend with the prospect of graduating into the worst cost of living crisis in decades.
As Nina says: “The government and members of the so-called ‘elite’ need to be held accountable as this has been a pattern for far too long. Are they just going to continue playing us for fools?”