Student debt continues to climb

The debt burden on students is increasing

The average student debt in England and Wales jumped 10% in 2003 as the costs of studying rose, a study has found.

The average student leaves higher education owing £12,069 through credit cards, bank and student loans, research by Barclays bank discovered.

Average graduate debt has increased five-fold since 1994, the bank said. Barclays warned that if the current trend continues average student debt could top £33,000 after a three-year degree by 2010.

Students at university in the South West finish their degrees with the highest debts, owing £14,802 on average.

In contrast, students in the Midlands had the lowest debts, owing £11,484 on average.

Most money owed by students was to the Student Loan Company, followed by banks, relatives and credit card firms.

"The escalation of graduate debt over the last decade is the net result of the rising cost of living, the continued impact of the introduction of tuition fees and the abolition of the grant system," Jeremy Law, Barclays spokesman, said.

Barclays added that the knock-on effect of escalating debt would be that people are saddled with debt for longer and would be unable to buy their first home or start paying into a pension until much later in life.