It’s a great idea, but how do you get your students to finance their first bike?
In a new book, a group of researchers at the University of Bath, the University in London and the University College London look at how bike-buying is changing.
They found that for young people, buying a bike is not only easier, but is also a great investment, particularly for the first time.
Their findings are published in the journal Transportation Research Part F. RTE contacted the authors for comment, and a spokesperson said they had no comment.
Rethinking the bikeThe authors analysed data from the British Household Survey for the years 2006 to 2010 and found that: young people aged 16 to 24 have the lowest share of total household income (44 per cent), the highest share of family income (52 per cent) and the lowest amount of interest income (9 per cent).
The average debt for these people is £21,400.
By contrast, older people (60 to 79) have the highest debt (46 per cent of household income) and average income (more than £80,000), while the median debt (about £50,000) is among the lowest.
They also found that, in terms of the types of debt students carry, younger people were more likely to be carrying a mortgage (27 per cent compared with 19 per cent for older people), but that they were also less likely to carry a car loan (24 per cent vs 33 per cent respectively).
In the survey, young people were also more likely than older people to be using a car for work (25 per cent versus 15 per cent); for example, the researchers found that young people in their 20s were three times more likely as older people in the same age group to be driving a car than their older counterparts.
But, unlike older people, young adults were also significantly less likely than their elders to have a loan to cover their own living costs (30 per cent to 60 per cent among those aged 20 to 24 and 38 per cent in the 40 to 64 age bracket).
“Our study found that the number of students who borrowed for their own bike purchase was relatively small.
It is possible that students who had borrowed for a bike were also borrowing from their parents,” said Professor Ian T. Brown, one of the authors.”
It is also possible that student borrowing was driven by financial reasons and not by desire to purchase a bike.
In addition, there was no evidence of students borrowing from friends or relatives for their bike purchase.”
He added: “The fact that young students have a lower proportion of their income borrowed from parents than their parents have suggests that young borrowers may be more vulnerable to interest rates.”
He said that the research could be applied to a wider range of young people who are more likely, or less likely, to borrow for a motorcycle purchase, and also to those who are buying their first bikes.
“Our research suggests that a range of student loans could be used to provide a loan for bike purchase, even though these loans might not be as cheap as student loans in the past,” he said.
“Students can borrow up to £50 for their bicycle purchase if their parents or guardian are in debt and are willing to support them for a period of time.”
They can also borrow to buy a used bike from the Government, but there are no figures available.