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Money to Learn
As well as thinking about what you want to do next, you should also consider the money situation.
If you are still in school you’ll get information and advice about what is available and how to claim.
Talk to your Connexions Personal Adviser who will be able to help and advise you or put you in touch with local organisations.
Money to Learn
The Money to Learn website (see links) gives details of all the following sources of funding for 14-19 years olds:
- Care to Learn – this can help pay for your childcare costs while you learn, if you're under 20.
- Dance and Drama Awards – awards are available at 21 of the country’s performing arts colleges.
- Education Maintenance Allowance (EMA) – up to £30 cash per week if you carry on learning. You may be able to claim for this on an e2e programme.
- Transport to school or college – your local authority may be able to help with the cost of transport.
- Studying away from home – term time rent and travel costs if there is a course you want to take but it isn’t offered locally.
Learner Support Fund
Some 16+ students on full or part-time courses will be able to claim this to cover the cost of:
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You can claim learner support funding even if you are receiving an EMA, Care to Learn funding or Disability Living Allowance. The amount you get will depend on the individual school or college.
If you’re at college speak to your student support or welfare officer. If you’re in the sixth form speak to your tutor or student awards officer.
Bank and building society accounts
Banks, building societies and the Post Office love to sign up new customers. Many offer high interest accounts for young people. Some offer a free gift if you open an account.
You have a lot of choice as where to put your money. Shop around – see who has the best interest rates and services for you. And don’t forget – it is quite easy to swap to a different provider, so as things change you can too!
To open an account you will usually have to:
- Prove who you are
- Prove where you live
- Prove you are a student (if relevant)
- Fill in an application form
- Have some money to put in the account.
If the account you want allows you to borrow or go overdrawn then a credit check will be run. This will show whether or not you are a reliable customer.
Minimum wage
Almost everyone who legally works in the UK is entitled to receive at least a minimum level of pay. This is called the national minimum wage. The amount is set by law each October.
Generally, employers must pay all their workers the appropriate minimum wage. This includes home-workers, agency staff, part-time and casual workers, and foreign workers. It does not matter how much experience you have. There are a small number of exceptions.
Some workers do not qualify for the minimum wage, or only qualify after a set period of time. This may apply to you if you are:
- an apprentice under the age of 19
- an apprentice aged 19 or over in the first year of your apprenticeship
- a student on a work placement, forming part of a UK higher or further education course, if the work placement is for less than one year
- taking part in the European Leonardo do Vinci or Youth in Action programme.
There may be other reasons you don’t qualify. Check with the National Minimum Wage Helpline.
| Age |
Rate from October 2007 |
Rate from October 2008 |
|---|---|---|
|
18 - 21 |
£ 4.60 |
£ 4.77 |
|
16 - 17 |
£ 3.40 |
£ 3.53 |
Benefits
There are very few benefits available if you are under 18. In certain circumstances you may be able to claim Young Person»s Bridging Allowance, Job Seeker»s Allowance, Income Support, Working Tax Credit, Child Tax Credit, Carers» Allowance or Housing Benefit.
Saving and investing
It’s important to look after whatever money you have – pocket money, student loan, training allowance, wages or benefits. Having a budget will help you plan how you spend, or save, your money. Knowing exactly how much money you have will help you make sensible decisions about what you can afford and avoid getting into debt.
Using a budget calculator (see weblink) will help you see where you need to spend your money and what is left for the things you want.
One option with any spare cash is to save or invest it. This will keep it safe and it’ll earn interest if you put it into the right sort of account. You’ll need to decide if you want to save the money for only a short time (saving) or a long time (investment).
Income tax and national insurance
Whether you are working, a student, saving or on benefits – you are likely to pay tax of one sort or another.
Income Tax – this is taken not just from earnings but also from some benefits, savings interest and investment income. It pays for things like education, health, the police and defence.
National Insurance (NI) – all 16 year old, UK residents are automatically issued a NI number. Keep it safe and do not give it to anyone who does not need it. The contributions you make pay for benefits and the basic State Pension.
Student Loan repayments
You will start to repay a Student Loan (taken out to pay for a course of higher education) when you reach a certain level of earning. In 2008 this figure was £15,000. The money will come out of your wages at the same time as your income tax and National Insurance. Your employer will normally take care of the paperwork for you.
You will pay interest on this loan – but not as much if you had borrowed the same money from a bank. You can make voluntary payments to pay it off quickly. You will still need to pay this loan off even if you are self-employed or working abroad.
Pensions
Pensions are a special sort of saving to support you when you retire or reach a certain age. They pay a regular (although not necessarily large) income for the rest of your life.
There are three main types:
- State – provided by the state. This is dependent on the amount of National Insurance you pay during your working life.
- Occupational – provided by your employer(s). These are set up by employers to provide their employees with a pension when they retire. It’s always worth considering joining a company pension scheme.
- Personal – provided by banks, building societies and life insurance companies who invest the amount you decide to save. It is well worth setting up a personal pension early on in your working life.
It is possible to benefit from all three of the above.
Debt
Owing more money than you can afford to pay out is called debt. Getting into debt is a lot easier than getting out of it. And it never goes away by ignoring it. The sooner you seek professional advice the better. There are lots of people and organisations that will offer to help clear your debt but will really just make matters worse. There are no quick fixes to sorting a debt problem – but it can be sorted.
Talk to your Connexions Personal Adviser who will be able to put you in touch with local organisations that can help and advise.
Weblinks
Money to Learn
Disabled Students’ Allowances – extra financial help if you have a disability or learning difficulty. Go to Disabled people>Disabled students’ allowances.
External link: direct.gov.uk
Education Maintenance Allowance (EMA) – funding to help you stay in learning.
External link: direct.gov.uk/ema
Money to learn - details of all the sources of funding for 14-19 years olds.
External link: direct.gov.uk/moneytolearn
Bank and Building Society Accounts
Basic bank/building society accounts
External link: moneymadeclear.fsa.gov.uk
Moneysupermarket – compare student and young persons’ accounts. Go to Money>Current accounts>Student and young persons’ accounts.
External link: moneysupermarket.com
Minimum Wage
Department for Business, Enterprise and Regulatory Reform - more information and the current rates. Go to Employment Matters>Pay>National Minimum Wage
www.berr.gov.uk
National Minimum Wage Helpline: 0845 6000 678
Benefits
Benefits information
External link: youthinformation.com
Information about benefits
External link: jobcentreplus.gov.uk
Information for disabled people and carers
External link: jobcentreplus.gov.uk
Saving and investing
Budget Calculator
External link: moneymadeclear.fsa.gov.uk
Facts about saving and investing – what you can do with your spare cash in the short or long term.
External link: moneymadeclear.fsa.gov.uk
Managing your money – making the most of what you have.
External link: direct.gov.uk
Income Tax and National Insurance
Beginners’ Guide to Tax – go to Money, tax and benefits>Beginners’ guide to tax.
External link: direct.gov.uk
Income Tax and National Insurance – go to Young people>Money>Taxes and you.
External link: direct.gov.uk
Student Loans
Repaying your Student Loan – everything you need to know.
External link: hmrc.gov.uk/taxandu
Student Loans Company – student finances
External link: slc.co.uk
Pensions
Pensions – find out about all the different types of pensions. Go to Money, tax and benefits.
External link: direct.gov.uk
Pensions – go to Pensions.
External link: moneymadeclear.fsa.gov.uk
Debt
Citizens Advice Bureau – includes a useful ‘debt test’.
External link: adviceguide.org.uk/debt
National Debtline – information pack and fact sheets.
External link: nationaldebtline.co.uk
T: 0808 808 4000
Youth Information – lots of useful advice and information. Go to Money>Debt
External link: youthinformation.com
Publications to download
National Minimum Wage – a guide for workers.
