Am I being unrealistic with my plan to use my student loan for a down-payment for a house?

[christian39]

I am about to be 19 years old and entering my second year at uni doing a Master's in Psychology (4 years total). I've had this idea to save my maintenance loan and use it as a down-payment on a small home and need someone to tell me if I'm missing something lol. I'm also very good at budgeting if that's relevant.

So,

I recieve the full maintenance loan of £9,900 per year, plus a £1,200 bursary from the university. (Possibly getting an additional £1,200 bursary from my county too)

So by my mediocre maths it work out to: £5,500 in my savings currently plus each year:
-£9,900 from the maintenance loan
-£1,200 bursary
Which comes to £38,800 after the three years are up.

(I will be starting a job this September on campus where I will earn £10 p/h for >15hrs weekly. Over the 8-9 months I'll be at university in a year this should come up to £5k~ so just enough to pay for my accommodation. Therefore the only expenses I need to worry about are food and fun)

After a year for mandatory work experience I'd hopefully start my PhD, with the average salary being £35,000 as a trainee clinical psychologist, so I'd have a steady income.

Being realistic, would I be accepted for a mortgage when I start my PhD? I'd be 22 and I know student loans don't affect credit scores so is it possible? I don't really know much about mortgages beside how long they take to pay off.

Also this would be a large amount of money after a while so would it be a good idea to start looking at low risk investing?

I'd honestly appreciate any advice

Edit to clarify: I'm not planning to apply for a mortgage right now, I meant a little while after I started my PhD, of which I would get a £35k salary at the same time

 

[jhanice]

@christian39 If by PhD you're meaning the DClinPsy Doctorate, I don't want to rain on any parades, but please be aware it can take many years of applying and interviewing to be accepted on the course, I know many people who took 3-4 attempts, and some on the course even 7!

That does not mean it's not doable, and is an incredible aspiration, but please don't base any financial plans around getting on the doctorate first year out of uni, as it is extremely competitive. Most pathways begin with an Assistant Psych role with salaries around the 22-24k mark.

 

[richa]

@jhanice Was going to write the same thing. Besides, you may find partway through the course that another area outside of DClinPsy appeals and you pursue that instead. A standard PhD will pay a stipend which isn’t a lot; certainly far, far less than on the DClin. Then you have to find a post-doc, or start on the non-academia route. It can take a lot of time to reach a steady income of this amount.

 

[christian39]

@richa Hmm that's really true, i guess timing is really the biggest issue for me

 

[jhanice]

@richa Definitely! It's a long time to stick to a plan and not get swayed into anything else!

One of my best friends is a lecturer in psych and dyslexia, and he's always complaining that the tripling of course fees didn't come with a tripling of his salary!

 

[richa]

@jhanice Haha that’s correct; instead just triple the amount of emails and assistance expected from some students

 

[christian39]

@jhanice That's very true! I hadn't assumed that the process would be completely simple like above, but there aren't many resources I can find that go into detail about the application processes and such. This is very useful to know! the above is really supposed to be an outline, even if it isn't fulfilled within that exact time frame

 

[jhanice]

@christian39 It's good to have that target! But perhaps also look into counselling courses, or academic teaching/research, or working as a pwp, or even within a forensic setting! All fascinating and all crying out for good motivated people! Good luck in the future, wherever you choose!

 

[christian39]

@jhanice I'll definitely keep looking at other courses while I'm still learning, thanks for the advice!! )

 

[kateeight]

@christian39 Happy to help with further info as currently working towards DClinPsy applications. Can confirm it’s very competitive. My best recommendation if you are in a position to do so is to get a healthcare worker role while you are completing your degree. It will give you relevant experience for Assistant Psychologist posts (£21-25k) or you could look at other jobs such as trainee Psychological Well-being Practitioner or Clinical Associate Psychologist (where you study for an integrated masters while completing training in the NHS) which are slightly higher salaries. If you are working towards a PhD, this is different and you will receive a stipend. I believe my friend who is on a psychology PhD receives £18k. Just something to be mindful of in terms of finances.

 

[christian39]

@kateeight Wow thats really helpful thanks! So while completing a Msc I could be gaining the relevant experience at the same time? I had assumed it'd just be an extended year of the course. Also do you mean get a health care worker role while I start second year of my bachelors?

 

[kateeight]

@christian39 Sorry, are you referring to the CAP role I mentioned? And yes, getting a healthcare worker role anytime during your undergrad is helpful, it’s hands on experience and employers for AP roles will definitely take this into consideration rather than just your degree. It’s also a helpful way to meet people on a similar career path. If you’re lucky, there will be psychologists and APs that work there and in my experience, you can approach them for tips and advice for the future! Feel free to message me if you need more info.

 

[gailt]

@christian39 The more obvious thing is no one is going to give you a mortgage when you start your PhD based on one years income or a couple of years at £5,000.

Although the student loan doesn’t count as debt you can’t really include the payments as income.

 

[christian39]

@gailt So they look at past income regardless of my current salary? Would it be better to wait several years into the PhD or would they still disregard my current salary?

 

[gerri45]

@christian39 You may find (like I did) that a PhD stipend isn’t considered income, because technically it’s untaxed grant money. So I didn’t qualify for a mortgage as a PhD student, or at least my salary didn’t count towards it.

 

[christian39]

@gerri45 Ah okay, I'll keep that in mind

 

[myooran]

@christian39 Yep. I had a grant for my PhD of £16k per year and tutored to top up, so had £40k coming in. Mortgage company viewed me as self employed and earning £24k, needed 3 years of accounts to qualify. Previous years, I had earned less as was building my client base. It was an umbuggerance.

 

[jtc26]

@christian39 You will be getting £35K to do Phd?

 

[christian39]

@jtc26 The NHS health career website states that trainee clinical psychologists are mostly funded by the NHS and earn a salary of 35k if under 2 years of experience

 

[resjudicata]

@christian39 Ahhh the chances of you getting that first try is slim, definitely prepare to wait for a few years on assistant psych positions at the very least.