Copies are available from the DofEE Publications Centre, PO Box 6927, London E3 3NZ, telephone 0171-510-0150.l Obtain grant forms from your Local Education Authority. This is an excellent outline of the system and it will prove invaluable. This figure, which is a 31 per cent increase on the indebtedness of 1994 graduates, includes an average of pounds 583 owing to their bank or building society.As the amount of loan available to each student has increased in recent years to compensate for the fall in the level of grants, the indebtedness of future graduates will rise. For a three- year course, they are spread over a five-year period and repayments may be deferred if a graduate's income is less than 85 per cent of national average earnings - currently pounds l,267 a month.It is therefore not surprising that Barclays Graduate Survey, published in April 1996, revealed that students' indebtedness six months after completion of their courses last year had risen to an average of pounds 2,930. Indeed, a "back of the envelope" calculation for a student beginning a degree course this September, who takes full advantage of the loan scheme, shows they will graduate after three years with a loan of about pounds 4,710 if they study in the provinces and around pounds 5,800 if their course is in London.Here are our tips for the parents whose sons or daughters are contemplating undertaking a degree course:l The Department for Education and Employment publishes a very useful guide: Student Grants and Loans. Repayments are made monthly and begin in the April after graduation. David says: "First-year students live in hall, but next year he will share a house with others.

To secure accommodation for his second year, I had to pay his share of pounds 350 of the deposit for his room in the house he decided to rent with friends."Student Loans are not means tested. Did David's son take advantage of this top-up funding? "Absolutely - without the loan, it would have been very difficult to fund his living costs." The loans attract a nil rate of interest, but the amount advanced increases with inflation. Students who are the only child and are studying away from home on a standard-length course in the provinces receive nothing if their parents' residual income is pounds 32,208.85 or more. The trigger residual income for no grant increases to pounds 35,171.35 for students studying in London who do not live at home.David initially allocated the full grant for his son's living expenses, giving him an additional pounds 200 in the first term as a "float" However, it was soon clear that this was insufficient. The insurance of his possessions, travel to and from university and the purchase of a personal computer have all been funded by David At Easter a further outlay was required. Above this figure, the grant reduces as the residual income increases. This is basically gross income from whatever source, plus "benefits in kind", which is the value the Inland Revenue puts on company cars and company private health schemes less payments that qualify for tax relief, such as mortgage interest.When the parental residual income is below pounds 16,050, students receive the full grant.