To believe £27k University debt will put children off?

[Mitmoo]

I am a graduate so value education but now we've seen that so many universities will be charging £9k a year that it will make todays pupils think that a degree just isn't worth the cost?

I know it doesn't have to be paid back until they are earning £21k or thereabouts but they are looking at 20 odd years of debt, more for some and no option to pay it off early if they get a windfall.

Add that to so many graduates not in graduate jobs and others out of work.

AIBU to think we are going to go back to the bad old days when university access won't be based on how smart you are but how much money your parents have?

Sandinbuckets I was kind of half-joking but I can see it could be a winner here on Mumsnet if enough people wanted to sign up for it.

So what happens, will everybody now choose a subject that leads into a well paid career (to make the debt worthy)? In that case i think we will end up with a) too many lawyers, accountants and b) some very unhappy people who were talented at something else but choosen something completely different.

And will we be sort of teachers and journalists then? In which case the earnings of these jobs will go up because of the demand?
Do i have too much imagination?

I live in Belgium and it is the norm to go to a Uni near home here; those with kids coming up to uni age could also look at Maastricht which teaches in English. The 1800 euros per year they charge looks better than the £9k in the UK.

I am one of those who doesn't want their child coming out with shed loads of debt, so will be looking at the Maastricht option as it is cheaper even with paying rent and food as well.

Yes, of course it will put some people off.

It would have put me off. I went to Oxford in the last year of no fees, but no grant. I managed to come out with no debt by working through holidays, lodging with friends in holidays etc. There's no way I would have gone otherwise!

Despite my degree we are struggling financially and there is no way I can afford to put my daughter through uni without her coming out in tons of debt. Considering we are struggling with mortgage with todays houseprices I can really see how it would put people off from low-income or debt-adverse (we don't use credit cards, my family doesn't etc) families.

I think it will be a case of mainly the rich (the same ones that pay for their children's deposit for houses these days etc) who go.

The thing is Cat tuition fees and mortgages aren't really comparable, if you don't buy you have to rent and renting is just as expensive, you have to live somewhere, with tuition fees that's a choice.

It has put my two off. After working hard to leave secondary with good grades, one is going overseas to work as an au pair and one settled for a lesser college qualification which won't leave her up to her eyes in debt. DH and I both graduates but doesn't look as if DCs will be.
On the plus side, DD1 has a fair amount of savings stashed away from two years out working in temp jobs here and there, as well as excellent references and a good work ethic, and DD2 is about to experience living and working in another country and learning how to cope using a foreign language. Perhaps more useful than a shedload of debt and a piece of paper which won't guarantee you a job anyway.
(My company recently advertised a part-time, temporary office junior post paying peanuts and we had over 80 applications, several of them graduates!)

Just an anecdote note about Open University (OU) degrees which someone mentioned upthread.

I think it's an urban myth that they are less well considered than a regular degree.

My BIL is a Russell Group university professor (sciences) and says when he receives CVs for PHD students any who has done an OU degree automatically go to the top of his pile. He says completing an OU degree, and getting a high grade it in, requires more commitment, self-motivation and drive than a degree from any other UK university.

Dementeda Good for your children I wish them all the best.

Re: the job and graduates chasing office junior jobs. Isn't that sad. I'm a graduate and an Avon Lady at the moment, I've just recruited another Avon lady, another graduate!

If someone really wants to go to UNI then they should get themselves a job first and save up for it.
It was never going to work as a way to get a well paid job, not enough jobs out there for UNI graduates in the first place.

Unless you are training for something specific, then it's a waste of money in the long run.

Don't know if this has been saidhere before but, despite all the seeming illogicality, evidence that fees-from-debt discouraged applications has been very hard to come by. Most surveys suggested that candidates decided to go to university for the 'normal' reasons (intellectual curiosity, good prospects) and just accepted the debt, just as those of us who went on smaller loans and no grants did.

What did happen was that there was a shift in applications-that very prestigious universities saw an above trend rise (if I'm paying, I'll go for the 'best') as did those in metropolitan centres (I'll stay at home so less indebted through rent). And that the proportion of students in part-time work also rose.

Don't know what will happen this time, but the question would seem more how it affects an individual's decision to apply to a certain university and their capacity to benefit (especially with differential fees) NOT whether they are put off.

thank you mitmoo. I think they are doing the right thing and hope they will be happy.

Last- that explaines why i meet so many people on MA's, in subjects that was once difficult to get on a MA, in, they can pass the qualifications, but should not be doing the job. In occupations involving social care, usually. All they have is paper qualifications and no skills

explains, no e, sorry.

yes it will put people off

Marlinspike

I studied in the UK and moved abroad to work for a number of years and I assure you that the Student Loans Co were regularly in touch to check on my earnings and inform me what I needed to pay back and when.

I meant to say if it's not deducted at source they expect you to set up a direct debit or make regular instalments from your country of residence.

It was me that mentioned OU degrees, on the recieving end they do not compare to a traditional degree.I am left on my own with little tuition to read dumbed down books. I am very surprised that they would be welcomed by employers and I say that as someone working hard to get an OU degree.

Sometimes I feel banging on about the 'problem' makes it more of one, however much I hate it.

When I went to Cambridge my parents were very worried I would have to work and run up debt because they were used to grants. I couldn't have given a toss. When fees were introduced I was much more angry than the undergrads I taught-they were proud of going to uni and the debt was distant. They are now horrified at the debt burden of their siblings, but 17 year olds I've talked to aren't because it's just life. Each generation has come in increasing numbers despite increasing personal cost, the real anomaly would be if that reversed, and would need careful arguing for beyond 'common sense'.

What it does to the university sector, its function and role, the teaching and research it offers, where it is supported; and what these mean for the educational opportunities of those entering it worries me far more than that they won't come-they have in increasing numbers over a long time despite radically increased costs.

There's a good estimator of total amount you will pay back vs loan amount and salary on Martins Money Saving Expert Site.

It gives rather different figures than catgirls estimates because it assumes starting salaries rather than average salaries over 30 yrs and estimates inflation + 2% salary increases over the years which is probably more realistic.

So for someone with full 3 yr loan of 45.5k:
starting salary of up to £15 they pay back nothing
starting salary £20k pays back £14k (loan not fully paid off)
starting salary £30k pays back £73k (loan not fully paid off)
starting salary £40k pays back £133k (loan not fully paid off)
starting salary £45k pays back £108k (loan fully paid after 24yrs)

It's a lot of money to pay back especially for those mid-high earners who almost but not quite clear the debt before 30 years are up. £133k is a lot of money to not have to spend when you are raising a family etc. So if you can find a way to the same £40k starting salary job without incurring the debt (by studying abroad or with OU or whatever) then you'd be wise to consider it.

snorkie- slightly confused by your example. Do they all owe the same- ie. £108 k ?

No, they all start with equal loans of £45.5k, but because interest accrues they end up paying far more back (in many cases). Follow the link to read a fairly detailed explanation.

£45.5 = (£9k fees + £5.5k maintenance loan) * 3 years

Wouldn't that prove a degree from the OU is harder to obtain? Working alone and motivating yourself to degree level is an impressive achievement in itself especially if you have to do it around other commitments.

I do understand why attending university full time and immersing yourself in education and student life is more attractive and satisfying. That is the ideal scenario; but I'm sure I've read before how highly regarded OU degrees are by employers for the aforementioned reasons.

If university fees are going to become prohibitive, then I do think it's going to be necessary to change our perception of what studying for a degree may involve. Perhaps to accept that other routes (ie OU) are just as valid if they lead to the same outcome, but in a more affordable way.

Working out the costs doesn't tell you anything about the effect. Mainly because 18-year-olds are not very economically rational (hence the huge applications for Forensic Science).

Mortgages are the same. People worry about whether they are affordable, provide security, and hope they acquire a worthwhile asset since they'll need housign for the rest of their life. At no point did I sit down and think how I might use the 50 extra quid a month and the lifetime 160k interest over my life if I rented and invested it elsewhere. Does anyone?

Whether handing education priority decisions to this group of not very rational folk is a good idea, I leave you to ponder.