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Jargon Buster

Navigating the world of finance can be very confusing. This guide aims to help you understand some of the common terms used to help make things clearer. Click on a letter to find definitions to some frequently used finance terminology.

A

Access to Learning Fund (ALF)

The Access to Learning Fund is a hardship fund, which can provide non-repayable support to fully enrolled Home students experiencing financial difficulty. The Fund may help with course-related and living costs, and is assessed individually on application.

For more information about ALF and the application procedure, please visit www.warwick.ac.uk/hardshipfunds.

Account

This is provided by a bank or building society which holds money for you. A current account is an everyday account which allows money to be paid in or taken out. A basic bank account is a special sort of current account which doesn’t usually allow you to overdraw. A deposit account is for your savings.

Adult Dependants Grant

The Adult Dependants' Grant can provide extra help to full-time Home students who have an adult who depends on them financially. This assistance is available to students who qualify for student support from the UK Government. The amount available depends on the students income and the income of dependants. This help is paid in addition to the student loan and does not have to be repaid.

For more information, please visit www.gov.uk/studentfinance.

Annual Percentage Rate (APR)

The Annual Percentage Rate represents the overall cost of borrowing on your credit card, loan or overdraft and is helpful when comparing credit and loan offers. The APR includes factors such as:

- the interest you will need to pay

- how you will repay the loan, the length of the agreement and the timing and amount of instalment payments

- any fees associated with the loan

- any premiums for insurance that the lender deems compulsory.

Lenders are required to inform you of the APR before you sign an agreement. APR varies from lender to lender, so it is always best to shop around.

Arrears

If payment of a debt is overdue, you may find yourself in arrears.

If you are unable to make an agreed payment for an outstanding debt, you should contact the company concerned to discuss your options and hopefully avoid any penalties.

If you are worried you cannot keep up repayments on your financial commitments and are getting behind, contact your local Citizens Advice Bureau or the Student Advice Centre in the Students' Union. 

Assets

Things that are owned, such as cars, property or money.

Automated Teller Machine (ATM)

A cash machine. ATM's allow you to withdraw cash directly from your bank account or credit card, make deposits and request statements.

Most ATM's owned by banks and building societies allow you to access these services free of charge. However, some machines (primarily those located in shops, bars, pubs and clubs) charge a transaction fee. Try to avoid using these where possible, you'll be surprised how these charges can add up over the year!

B

Balance

This is the amount of money you have in your account at any particular time or which you owe on your credit or store card. It will be shown on your statement

Bank Automated Credit System (BACS)

A direct transfer of money into your account from someone paying you (for example, your employer).

Make sure that when providing your bank details for payment that you have given the correct information!

Bank Statement

A document sent to customers by their bank listing the transactions (money in and out) on an account – usually sent monthly.

Bankrupt

Bankruptcy is a legal status that usually lasts for a year and is a way of clearing debts you can't pay. Your non-essential assets (both property and possessions) are used to repay your creditors. At the end of the bankruptcy term, most debts are cancelled.

It is important to seek independent financial advice prior to applying for bankruptcy, in order to consider the implication to your finances and any other options available to you. Contact your local Citizens Advice Bureau or the Student Advice Centre in the Students' Union for guidance initially.

 

Base Rate

The rate of interest set by the Bank of England on which other lenders base their rates. This is important as it affects how much it will cost you to borrow money and how much money you can make on your savings. Rate changes affect different products in different ways, so not everyone will see a change in their interest rates when the Bank of England changes the base rate.

If the interest rate on any of your financial products changes, your lender should notify you before they apply it.

Benefits

You may be eligible to apply for financial support from the Government if you have a low income or if you have particular costs to meet as a result of your personal circumstances.

Benefits are usually split into categories- those which as income-based (your eligibility depends on your household income), and those which are contribution-based (your eligibility depends on your National Insurance contributions). Other benefits may be payable because of your circumstances, such as benefits if you have children, or a disability.

Full-time students are not generally eligible for Government benefits, unless they are a lone parent, student couple with a child/children or disabled.

To query your eligibility for benefits, see www.gov.uk, or contact your local Citizens Advice Bureau or the Student Advice Centre in the Students' Union.

Budget

A personal money plan which helps an individual to manage their income and expenditure. It is usually for a period of a month or a year, but can be for longer. Businesses and governments also use budgets.

Buildings Insurance

If you own a property, you may wish to insure against damage by fire, floods or subsidence. Damage to fixed fittings such as baths and kitchens can often be included, as well as sheds, greenhouses and garages. If you have a mortgage, it is likely that your lender will require you to take building insurance, in order to protect their investment.

Policies can differ between lenders, so it is important to shop around to get the best deal for you.

 

C

Cheque

A document that allows you to make a payment from your account to someone else.

Many shops no longer accept cheques, but they are still useful when paying money to an individual or for sending funds through the post. Remember to keep your cheque book safe to prevent fraud.

Childcare Grant

Full-time, Home students with dependant children can apply for a Childcare Grant to help with childcare costs. If you qualify, the Childcare Grant could cover as much as 85 per cent of your childcare costs during term time and holidays. This help is non-repayable and is paid in addition to your student loan and grants.

For more information, please visit www.gov.uk/studentfinance.

Citizens Advice Bureaux

A voluntary organisation offering unbiased advice on money matters, including tax and benefits, legal and social issues.

Further information about the services offered by the Citizens Advice Bureaux can be found on their website: www.adviceguide.org.uk.

Contents Insurance

Contents Insurance covers the loss of or damage to the contents of your home, such as furniture, electricals and clothes. It may also cover items you take outside of your home, such as cameras, laptops or jewellery.

Different policies offer different levels of cover, so it is best to shop around.

When choosing contents insurance ensure you have adequate cover for your belongings in case the worst should happen.

Cooling-Off Period

The time you have to change your mind and obtain a refund when buying financial products.

The amount of time will differ between companies, so check your paperwork carefully.

Council Tax

Council Tax helps pay for local services like policing and rubbish collection. It applies to all domestic properties, whether they are owned or rented.

If you are a full-time student and you live in a property solely with other full-time students, you will not be liable for council tax. It is important to provide evidence of your student status to the Local Authority to prevent a charge being made. Evidence of student status can be obtained from Student Records.

County Court Judgement (CCJ)

If you owe money, your creditor can take a County Court action out against you to recover the debt. If the court believes that you owe the money, they can issue a County Court Judgement order. The CCJ will either be for the amount agreed between you and your creditor or, if you can't agree, a payment set by the court. Once you pay off the debt, the CCJ is satisfied. Details of the CCJ will be kept on your credit file for 6 years and will affect decisions on your borrowing applications for at least this period.

If you receive a County Court Claim Form, don't panic. Contact your local Citizen's Advice Bureau or the Student Advice Centre in the Students' Union for help.
Course Grant

This award is for part-time students who started their course pre-2012 and is intended to help with the costs of books and materials. This help is means-tested.

For more information about your eligibility for the course grant, see www.gov.uk/studentfinance.

Credit

If your account is in credit, it means that you have money available to spend. If you obtain goods or services on credit, it means that someone, for example, a bank or credit institution, has given you the money to buy something. You must pay the money back, usually with interest.

Credit Card

Credit cards allow you to pay for goods and services up to a specified limit and repay the money later. The limit is determined on your credit score, following a credit check. Credit Card companies will usually charge interest on top of your balance for this service, meaning that your goods could end up costing more. However, credit cards can be a convenient form of borrowing if you can pay your balance off at the end of each month.

For more information about credit cards, please see our Credit Cards helpsheet.

Credit Check

Where lenders make an enquiry on the credit history of an applicant, normally by referring to one of the major credit agencies.

 

See our Credit Reference Agency Guide for more information about credit checks.

Credit Limit

The maximum amount you may borrow on a credit or store card. This is determined by the results of your credit check.

See our helpsheet on Credit Referencing for more information on credit scores.

Creditor

A person or business money is owed to.

Current Account

A bank account which allows a customer to deposit money and withdraw money, by cash, cheque, standing order or direct debit.

Many banks offer a current account specifically for students. The terms and conditions and opening incentives can vary between banks, so shop around.

D

Debit

Money that is taken out of an account.

Debit Card

Debit cards are issued by banks and building societies and allow you to pay for good and services with the funds already in your bank account, so no debt is accrued.

Paying by debit card can be safer than carrying large sums of cash with you. Always remember to keep your card safe and your PIN protected!

Debt

Money owed to another person or business. A person who owes money to others is known as a debtor.

Debt Counselling

Debt Counselling helps individuals to avoid incurring debt that cannot be repaid and negotiates with existing creditors to develop a managable plan to repay debt.

There are many free services that offer Debt Counselling. See our Debt page for more information and links.

Default

Failure to meet a financial commitment e.g. missing a monthly loan repayment.

If you think you will be unable to meet a payment to a creditor, contact the company concerned to discuss your options. This may help you to avoid any penalties and stop default notices from being recorded on your credit file.

Dependent Student

A student whose student finance entitlement is dependent on their household income, usually that of their parents.

Information on the criteria to be considered an independent student can be found at this link.

Direct Debit

A Direct Debit is an instruction from a customer to their bank or building society permitting a company to claim regular payments directly from their account.

Using direct debit ensures you do not miss payments. It's important to ensure that you have enough money in your account to cover these regular payments to avoid charges from your bank.

Disabled Students' Allowances

Disabled Students' Allowances are grants to help meet the extra course costs students can face as a direct result of a disability or specific learning difficulty. They are aimed at helping disabled people to study on an equal basis with other students.

Eligible full-time, part-time and postgraduate students can apply for Disabled Students' Allowances.

The amount awarded does not depend on household income. Disabled Students' Allowances are paid on top of the standard student finance package and don't have to be paid back.

For more information, please visit www.gov.uk/studentfinance or contact the Disability Services team at the University.

E

Early Repayment Charges

If a loan is repaid before the end of it's specified term, the lender can make a charge to cover administration costs.

If you are looking to repay a loan early, it is important to enquire with your lender how much the early repayment charge will be. In some cases, this could run into thousands of pounds.

F

Financial Advice

When looking to buy financial products, such as a mortgage, or make investments, it may be helpful to seek independent financial advice from a Financial Adviser. 

You can find details of Financial Advisers in your area through telephone directories or the internet. It may also be helpful to ask friends or relatives for recommendations.

When choosing a Financial Adviser, you can check that they are registered with the Financial Services Authority, by checking the FSA Online Register. The FSA have a formal complaints procedure should something go wrong.

Financial Services Authority (FSA)

The Financial Services Authority regulates financial services firms operating in the UK.

For more information, see the FSA website at www.fsa.gov.uk.

Fixed Interest Rate

This is a rate that stays the same for a defined period during a loan.

G

Gross Income

The full amount of money earned before any deductions such as tax, national insurance, pension contributions or student loan repayments.

H

Hire Purchase (HP)

This is a type of credit whereby you 'hire' the item you are buying for a fixed period. During this time you pay for the item in instalments, plus interest.

Unlike credit agreements, you do not own the item until the final payment has been made. If you miss payments, the creditor can ask you to return the goods.

Household Income

When making an application for means-tested student support, students will be asked to submit evidence of how much income has been earned by themselves and their parents/partner (if applicable). Based on your circumstances, certain allowances and deductions are made. The final figure is used to decide how much help you would be eligible for.

If there has been a change, or you are expecting a change to your household income, contact the Student Loans Company to enquire about re-assessment. For further information on how your student finance application will be assessed, see www.gov.uk/studentfinance.

I

Identity Theft

Identity theft is when someone steals your personal details and pretends to be you. They may then take money from your bank account, or take credit cards and loans out in your name.

It is important to keep your financial paperwork safe. Do not let anyone know your PIN or passwords, and always shred documents before throwing them away. Do not provide or confirm any personal information to anyone unless you are sure they are genuine.

Income

Amount of money received or earned over a period of time.

Income Tax

A tax on personal income. Usually deducted directly from wages or salary.

Independent Student

A student who is aged over 25 or who fulfils other criteria to be considered an independent student. An independent student can apply for student financial support without providing evidence of their parental income.

For further information regarding the criteria to be considered an independent student, visit the gov.uk website.

The independent student criteria for NHS Bursaries is different to that of statutory student support. Please visit the NHS Bursary webpage for details.

Interest

Interest refers to both the charge made by lenders on money you borrow from them and the amount earned by your savings. Interest can be variable (goes up or down) or be fixed.

The amount of interest charged or earned can differ between companies. Shop around for the best deal for you.

Interest Rate

This is the percentage that is paid on savings or loans. A savings account that was offering 4% would give you a better return than one which was offering 2%. Similarly borrowing money at 29% is going to cost you more than borrowing at 18%.

International Students' Childcare Fees Remission Scheme (ISCFRS)

The International Students' Childcare Fees Remission Scheme provides discretionary help to International and EU students with the cost of pre-school childcare. Applications are considered in the light of each applicants financial circumstances and the amount of childcare required. Registered full and part-time students can apply, providing they are using a registered or approved childcare provider.

For more information on applying for the International Students' Childcare Fees Remission Scheme, please see our webpage www.warwick.ac.uk/hardshipfunds.

International Students' Emergency Fund (ISEF)

The International Students' Emergency Fund (ISEF) may provide assistance to International and EU students experiencing short-term, severe financial difficulty as a result of an unforeseen or emergency situation. The funds are very limited and cannot be used to help with tuition fee costs, or to provide any ongoing support. Awards may be made in the form of non-repayable grants or loans. Registered full-time and part-time students are eligible to apply.

For information on how to apply for the International Students' Emergency Fund, please see our webpage at www.warwick.ac.uk/hardshipfunds.

J

Jobcentre Plus

Government agency that provides help and advice on jobs and training for people who can work and financial help for those who cannot.

To contact your local Jobcentre Plus, see www.gov.uk.

L

Lender

A person or organisation that lends money and charges interest on money owed.

The terms of borrowing can differ dramatically between lenders. Before taking out a loan, make sure they are offering the best deal for your circumstances.

Loan

A loan is a set amount of money that a lender has agreed to lend you for a set amount of time. Payment and interest charges are agreed at the start of the loan.

Loans may be 'secured' (the amount of money is secured on your home, meaning your lender could repossess your home if you do not keep up repayments) or 'unsecured' (the lender cannot repossess your home, but you are still legally obliged to repay). Before signing any agreements, make sure you understand the consequences if for any reason you cannot repay.

M

Maintenance Grant

The Maintenance Grant is non-repayable funding from the Government for full-time, home, undergraduate students. You may be eligible for a level of Maintenance Grant if your household income is below a certain threshold.

Students in receipt of a Maintenance Grant will receive a reduction in the amount of Maintenance Loan they are eligible for. The amount depends on which year you began your course and how much Maintenance Grant you are eligible to receive.

For more information about the Maintenance Grant, visit www.gov.uk/studentfinance.

Maintenance Loan

The Student Loan for Maintenance is Government funding available to full-time undergraduate students to assist with living costs such as accommodation.

Students eligible for the maintenance loan may also be eligible to apply for a tuition fee loan to cover the cost of their University fees.

The Maintenance Loan is repayable once you have completed or left your course and are earning over a certain amount.

Information about the support available through student loans can be found on www.gov.uk/studentfinance. 

Means-tested Student Support

Loans and grants which are based on the students own or household income.

For details about the financial support you may be eligible for, please see our Undergraduate Funding section.

Minimum Balance

The smallest amount of money you can have in a bank account, for example.

Minimum Repayment

The smallest amount you can pay towards money you owe on a credit card. It is stated on your monthly statement.

Mortgage

A mortgage is a loan taken in order to purchase property. Like other loans, the mortgage is repaid over an agreed term. The loan is secured on your property, so if you do not keep up repayments, your lender can sell it to recover their money.

If you are having difficulty keeping up repayments on your mortgage, you may wish to seek advice from your local Citizens Advice Bureau or the Student Advice Centre in the Students' Union.

Motor Insurance

To drive a vehicle in the UK, the law states you must have insurance in case of accident or theft. The amount you pay will depend on the vehicle you drive, where you live and your age, sex and driving history. There are different levels of cover to choose from which may also impact on the amount you pay.

Insurance cover can differ between companies and it is advisable to shop around to get the best deal.

N

National Insurance

You pay National Insurance contributions if you are employed or self-employed and are aged 16 or over. The contributions you pay build up your entitlement to claim certain social security benefits, including the State Pension.

The amount of National Insurance you pay depends on how much you earn. The contributions are deducted directly from your wages.

Net Income

The amount of income after all deductions (for example, tax and National Insurance). Also called ‘take-home pay’.

Non-Priority Debts

Non-priority debts include credit card payments, bank loans, catalogue repayments and money you've borrowed from family or friends. You can't ignore these, but you should address debts such as mortgage or rent arrears first, where consequences can be more severe.

Information about dealing with debt can be found on our Debt helpsheet.

O

Ombudsman

A type of independent complaints scheme which aims to settle disputes about financial products or services impartially.

If you would like to make a complaint about a financial service provider, you can contact the Financial Ombudsman Service for advice. Their website address is www.financial-ombudsman.org.uk.

Online Banking

A service which allows you to manage your bank account over the internet.

Overdraft Facility

An agreement with your bank which allows you to spend more money from your account than you have in it. You may be charged interest and fees to use this facility.

Only withdraw on an agreed overdraft, otherwise you may incur high charges. Shop around for the best deal- many banks offer a 0% interest offer to students, however it is important to check the terms and conditions carefully.

Overdrawn

If more money is withdrawn from your account than you have in it, you will be overdrawn. If you go overdrawn without asking the bank in advance, they might refuse to pay your cheques and charge you fees and a high interest rate on the money that you owe them.

P

PIN

Personal Identification Number – a secret number, which you use with your bank card. You must type this in to use the card. This ensures that no one else can use your card. You must always keep this number safe and not disclose it to anyone.

Part-time Childcare Grant

Part-time students who are eligible for student support may be eligible to apply for a Part-time Childcare Grant towards the cost of registered or approved childcare.

To apply, students will need to complete an Access to Learning Fund application form which can be downloaded from www.warwick.ac.uk/go/hardshipfunds.

Priority Debts

Debts that need to be paid first to prevent you from losing your home or getting a criminal record. These debts include rent/mortgage, utilities, child maintenance and council tax.

For information and advice on debt, please see our debt helpsheet.

S

Savings

Any money you put aside for future use. This may be in a deposit account, or under your bed. ‘Rainy day’ savings are useful for emergencies and need to be easily accessible, while longer-term savings can be built up to give a ‘nest egg’.

Savings Account

A financial product to keep savings secure within a bank, building society or in a credit union. The amount you put in does not fall in value but may grow as interest is added.

Secured Loan

This is money borrowed from a lender, using your property or other asset as a guarantee of repayment. If the amount is not paid in full, the lender may take the property back (repossess it) and sell it.

Special Support Grant

The Special Support Grant is like the Maintenance Grant in that it provides financial help to full-time, home, undergraduate students with living costs.

If you have an underlying entitlement to means-tested benefits, for example you are a lone parent, a student couple with children or you have a disability, you may be awarded the Special Support Grant instead of the Maintenance Grant. The Special Support Grant will not be taken into account as income in a benefit claim and no deduction will be made in student loan.

For more information about the Special Support Grant, visit www.gov.uk/studentfinance.

Standing Order

A regular payment for a fixed amount that a customer can ask a bank to make from their account to another.

This is a good way to ensure that you don't miss any payments. It is important to ensure that you have enough money in your account to meet the payment to avoid late fees or charges.

Statement

A document from the bank, building society or mobile phone provider, which shows all your recent payments into, and withdrawals from your account. You should check it against your own records.

Store Card

Store cards are similar to credit cards, except you can only use the card in that store. You will undergo a credit check to determine your credit limit. Store cards usually charge a higher rate of interest than other forms of borrowing.

Try not to be swayed by introductory offers of a discount or free gift. Weigh up the pros and cons before signing up. A higher rate of interest can mean goods that you buy can end up costing a lot more.

Student Finance

The University's Student Finance Team is responsible for managing the collection of all fees from students including tuition fees, accommodation fees, library fines and any other charges students may have whilst they are at Warwick.

Further information about the Student Finance team and how to contact them can be found on their website www.warwick.ac.uk/studentfinance.

Student Finance England

Student Finance England (SFE) administer all student support applications for students residing in England.

You can apply to SFE for student loan, grants and Disabled Students' Allowances. Applications can be made online through www.direct.gov.uk/studentfinance or by downloading a paper form from the same website.

If you live in another area of the UK, you should apply for student support through the relevant agency:

Student Finance Wales (for Welsh students): www.studentfinancewales.co.uk

Student Finance NI (For Northern Irish students): www.studentfinanceNI.co.uk

Student Awards Agency for Scotland (For Scottish students): www.student-support-saas.gov.uk

Student Funding

The University's Student Funding team offers advice and guidance on all aspects of student financial support.

This includes funding provided by the government in the forms of grants and loans and funding provided directly by the University.

The Student Funding Office also administers the Access to Learning Fund and other University Hardship Funds.

Should you have a query regarding student financial support, please contact the Student Funding Team on 024 7615 0096 or email studentfunding@warwick.ac.uk.

Student Loan

See Maintenance Loan or Tuition Fee Loan.

Student Loans Company (SLC)

The Student Loans Company administers the payment of student loans and grants to students. It also deals with the repayment of student loans when students have graduated from, or left their course. The SLC is owned by the UK Government.

Applications for student support are handled by the Student Loans Company's customer services centres. The centre you will use depends on where you live. See www.direct.gov.uk/studentfinance for further information.

T

Travel Insurance

Travel Insurance can assist if you experience an emergency whilst travelling. It can cover situations such as loss or damage to personal belongings, or pay for medical treatment should the worst happen.

There are a variety of travel insurance policies available, depending on where you are travelling to and how long you want the cover to last.

The cost and conditions of travel insurance policies differ between lenders and it is advisable to shop around to find the best deal for you.

Travelcard

A Travelcard is a pass that can be purchased from travel companies that allow you to make journeys without making payment everytime. There are many types of travelcard available, depending on the time that you travel, your age and how long you wish the pass to last.

If you use public transport regularly, it may be helpful to contact your travel company as purchasing a travelcard may offer savings on your transport costs.

Tuition Fee Loan

A Tuition Fee Loan is funding from the UK Government for full-time, home or EU undergraduate students. You can apply for all or some of the amount to cover your tuition fees and you repay the loan once you have completed or left your course and are earning over a certain amount.

For more information about tuition fee loans, please see www.gov.uk/studentfinance.

U

Unsecured Loan

This is money borrowed from, for example, a bank, which is not secured against your home. The lender may take court action against you for payment if you don’t pay the money back as agreed.

Utilities

Utilities are services provided to you such as gas, electricity or water.

If you are having difficulty keeping up with payments for your utilities, you may wish to seek advice from your local Citizens Advice Bureau, or the Student Advice Centre in the Students' Union.

W

Withdrawal

Taking money out of your account.