Graduate debt now tops £13K

Apr 15 2005 by Nic Paton Print This Article

Students are graduating with an average debt of £13,501, a 12 per cent increase on last year, latest figures have suggested.

Rising living costs and a resigned attitude to debt are behind the rise, argued the poll by Barclays bank.

An estimated 183,000 students would owe a combined amount of more than £2.46 billion, it said.

Jeremy Law, head of student and graduate banking at Barclays, said such levels of debt could act as a deterrent to young people considering going to university, especially as these figures were now likely to rise.

"If this trend continues, students starting a three-year course this September could be graduating with debts of almost £20,00," he said.

"Graduates will find themselves with debts for years to come which may affect their ability to buy homes and invest in pensions."

Fewer graduates in the north west of England were now in debt (a fall from 88 per cent in 2003 to 77 per cent in 2004).

This could be the result of more students taking a year off to earn money before embarking on university, suggested the survey.

Law advised students to consolidate their borrowing to keep debt manageable and pay off debts with the highest interest rates first.

"Where possible graduates should keep a tight reign on their finances to help set them up financially for the future," he added.