BAföG is considered the gold standard in federal education assistance and financing. Nevertheless, in 2018 only about 500,000 of a total of 2.6 million students in Germany received BAföG. Reasons for this may be the strict eligibility criteria or the fear of excessive debt after graduation. With the new BAföG reform (August 1, 2019) this problem should be solved. But what exactly has changed?
- Good news for families who have so far been just above the income limit for BAföG support. The reform provides them with targeted relief, as the income allowances was increased significantly: in the first step by 7 percent in August 2019, in the second step by 3 percent in 2020 and again by 6 percent in 2021. This improvement means that significantly more pupils and students are eligible for support, whose families have so far had to bear the living and training costs incurred during their education and training on their own.
- The maximum subsidy rate has risen by more than 17 percent and amounted to a total of € 861 per month in 2020.
- Housing costs are rising, especially in university towns. For this reason the housing supplement for BAföG recipients not living with their parents has been raised by 30 percent from € 250 at the time to € 325.
- Those undergoing training or studies should be able to draw on their own financial savings up to a certain limit, without this being counted towards the grant. To achieve this, the second amendment in 2020 raised the tax-free allowance for the creditable assets of recipients of grants from € 7,500 to currently € 8,200.
- More attention will be paid to the care of family members and/or the upbringing of one’s own children during studies or training.
- The BAföG supplement to health and nursing care insurance now also takes into account the average additional contribution paid to the individual insurance companies, which the statutory health insurance companies has also charged for students since 2015. It has increased from € 71 to € 84 for health insurance and from € 15 to € 25 for nursing care insurance.
- The decision for or against a course of study should not be guided by debt fears, which arise from the worry of not being able to complete the studies or not being able to earn sufficient income despite graduation. The new regular instalment for loan repayment is € 130 since April 1, 2020. However, anyone who has repaid 77 monthly instalments is definitely debt-free, regardless of how much his or her loan was originally. Usually, therefore, repayment of the BAföG loan portion is now completed after 6.5 years. Anyone who is unable to repay at least 77 instalments of the loan portion of their grant sum within 20 years, despite demonstrable efforts and compliance with all obligations to cooperate in the collection procedure, will then also receive final release from the entire (remaining) debt
You can find detailed information about the BAföG reform 2019 here.