Money expert Martin Lewis gives students tips on budgeting

But their parents are not much better informed, the survey of 1,000 adults and 500 young people for the Department for Education and Skills says.

Four out of 10 young people did not understand interest rate terms such as APR (annual percentage rate), says the survey.

A Talking Money guide is available to help students with their finances.

This publication from the education department includes tips and advice from personal finance expert, Martin Lewis.

We are encouraging parents and their children to sit down and talk about money together Bill Rammell Higher Education Minister

He said that all too often money was a taboo subject at home.

"It's time parents and students started talking, considering their cash, understanding how the system actually works and discussing how to live within a budget.

"Do that and there is no one who should be put off entering higher education because of worries about student debt," Mr Lewis added.

Higher Education Minister Bill Rammell said the guide was designed to raise awareness of the fact that financial help is available to cover the cost of higher education in the form of loans, grants and bursaries.

"We are encouraging parents and their children to sit down and talk about money together."

Concern about student debt has grown in recent years following the introduction of variable tuition fees.

From last September, universities have been able to charge undergraduates up to �3,000 a year.

The "back to basics" guide includes explanations of key financial jargon and tips on budgeting.

'Like a nag'

It also includes details of the kind of financial help available for students in different circumstances.

The poll commissioned by the DfES revealed that many parents were put off talking about money because of their children's attitudes.

Some 22% said their child did not think money matters were important, nearly half (48%) feared seeming "like a nag" and 13% said their children found money talk "boring".

However a quarter of 16 to 21-year-olds said they would not tell parents if they went overdrawn and 21% said they would not own up to having a credit card.

Although many youngsters said they did not understand key financial terms, the majority knew the implications of borrowing what you could not pay back.

Two thirds knew about IVAs - individual voluntary arrangements - where a person makes an agreement to pay back a sum with their creditors, and 85% understood about being declared bankrupt.