With total student debt now topping £14 billion it’s easy to understand why some potential students wake up in a cold sweat at the prospect of higher education, writes Matthew Wall. Recent studies indicate that the average student starts postgraduate life £12,000 in the red.

But most of us cope with mortgages throughout life so what’s a little student debt? With a bit of discipline and common sense you can keep it under control.

There are several places to turn. For a start, student loans administered by the Student Loans Company (SLC) are great value. You don’t have to start repayments until you graduate and earn more than £10,000 a year (£15,000 a year from 2006). Even then you only have to repay the loan at a rate of 9% of your income above this limit. So if your income after graduation was £15,000 your student loan repayment for the year would be £15,000 - £10,000 x 9% = £450. That’s not too scary.

Interest on the loan is only charged at the rate of inflation (2.6% from September 1) and you can borrow up to £4,095 a year, subject to means testing. If you don’t want your parents’ income taken into account, you can still borrow £3,070 a year. The SLC website (www.slc.co.uk) has a useful calculator to help you work out how much financial support you might get.

Before you go to university, be sure to quiz your local education authority (if you live in England or Wales), the Student Awards Agency for Scotland (if you live in Scotland), or the Education and Library Board (if you live in Northern Ireland) about any extra grants you might be eligible for. Also, investigate whether your college or university offers any discretionary scholarships and grants.

To tame the debt monster you have to live within your means while you are a student. Add up all your sources of income and draw up a provisional weekly budget. In the first few weeks get a sense of how much everything costs, including rent, fuel bills, travel costs and food, then budget more accurately.

Withdraw cash just once a week if you can. Frequent trips to the cashpoint make keeping track of your finances much harder. Be canny with your cash. Choose a bank account offering interest on credit balances and an interest-free overdraft.

Students with an iron will (there must be some) can also be quite canny with credit cards. For instance, Sainsbury’s bank is currently offering 12 months’ interest-free credit on its Visa card for new applicants. After that the rate reverts to 15.9% APR for purchases and 19.3% APR for cash withdrawals.

If you get a part-time job to supplement your income bear in mind that you can earn up to your personal allowance (currently £4,745) before being taxed. If you don’t expect to earn more than this get your employer to complete form P38(S), which allows your wages to be paid gross.

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