To think people are unaware on how much the government has SHAFTED students with loans

[SucksToBeMee]

This brings me so much anger to this day, and I took out my student loans from back in 2012 when 9k tuition fees were introduced.

I did a 3 year undergrad and I left with a 50k debt. I can live with my 50k student loan. Fine, the government wants to pass the cost on to students (not that I agree you they should be doing that) but fine.

But the interest rates are so unbelievably outrageous I have no NO CLUE how they've gotten away with completely shafting the whole (especially poorer) student population.

Do people realise the interest rate on student loans is 3% + RPI? It's currently at 6.6%

6.6% interest this year on a 50k loan. That's at least £3300.

I earn a £45k salary and I still won't cover the interest this year. I have been earning a fairly decent salary since graduating and I have never covered the yearly interest.

My outstanding debt goes up and up each year even though I'm paying them thousands in the year. I now owe them £55k after giving them around £6k since I graduated.

They will carry on taking 9% of my salary over 25k and 9% of all my bonuses for the next 30 years.

Anyone who took out max loan (aka from a poorer background) and ended up breaking the barrier through to a better life is fucked over the most.
The wealthier families get away mostly scott free.

I think it's absolutely outrageous, and I'm not sure people realise how fucked over we're actually getting with interest rates. I have a debt that I can never even start to pay off. I will pay them probably double what I initially owed them over the next 30 years.

Honourable mention: they also charge max interest rates on your outstanding loan for the duration of your study.

@MRex
@Saddler

For those telling me to overpay and pay off the loan early. I can not possibly do this, I'm not sure you realise how extremely difficult that is.

For me to clear my remaining debt IN 26 years (a supposedly pointless plan as it gets wiped after 26 more years for me anyway) I'd have to pay around £460 A MONTH toward it this year. Overpaying by around £300 a month.

I live in London, my rent is extortionate, I now partially support my family.

That's nearly £500 of my salary a month gone on top of my living expenses with ZERO benefit as the loan would (hopefully, please government) be written off in the same amount of time as if I payed the normal £170.

If say I wanted to clear this loan on the next 15 years I'd have to pay around £600 a month this year to get started, overpaying by over £400 a month.

This is without know what on earth the interest rate is going to be next year as it is variable. It could increase even further next year like it has done every other year then my payments would have to be even more. Also on the assumption I could actually cover the costs throughout the next 15 years. God forbid I decide to take a few years off and have kids, then my loan repayment plan would be completely screwed.

I know someone who was paying extra towards their loan. The following year there was an extra 2% on the interest rate and now they can't afford to make a good dent in the debt anymore and their previous years contributions have now more or less meant nothing in the grand scheme of things, just thrown down the drain.

Even if I could cover the cost, it would mean I couldn't even start to save up for a house for the next 15 years.

What would you do in this situation?

They have made it barely viable for people from a working class background to pay this off.

How quickly we're slipping towards the hellhole that is the American system.

When tuition fees were introduced, it was, what, £1000 at very low interest rates? Wow, how things have changed.

Can't believe people are trying to justify the high interest rates. "Well, get a loan elsewhere if its cheaper", "Well, just pay it off, then". WTF???

It's not supposed to be a commercial loan to make a profit on. It's supposed to be part of our country's education policy!!! It's supposed to be fair and equitable. Get a fucking grip, people!

Iamthewombat Crikey! Were the lectures in English or Dutch?

In English, most Masters in The Netherlands are in English. There were students from all over Europe on my course, except I was the only one from the UK. British students generally don't go abroad to study for whatever reasons.

" Of course like most of the country, I didn't have a spare 50k of cash at the age of 17 to pay for uni so was forced into the unfair interest rates."

no=one held a gun to your head and FORCED you to go to university...

IT ISN'T COMPULSORY! It's a choice adults are making... and then moaning about having to pay it back.

Why should people who CHOOSE to go to university get free tuition?

@00100001

*no=one held a gun to your head and FORCED you to go to university...

IT ISN'T COMPULSORY! It's a choice adults are making... and then moaning about having to pay it back.

Why should people who CHOOSE to go to university get free tuition?*

At what point have I asked for free tuition??? Through these 400+ posts, all I've ever asked in my current situation is for interest rates that are not atrocious.

You're implying people from working class backgrounds should have considered not going to uni because of the debt.

I COMPLETELY disagree with that. You should not have to reconsider your education because of your background.

no=one held a gun to your head and FORCED you to go to university...

Said someone of a previous generation where there were opportunities for decent jobs/professions with just O or A levels.

These days even some entry level low skilled jobs have a degree as a minimum requirement.

At least the tide is turning and apprenticeship schemes are becoming popular again as an alternative for those not going to uni.

You can't blame today's Uni students for mistakes made by past governments, such as Blairs' stupid 50% aim!

Why should people who CHOOSE to go to university get free tuition?

Why should people of previous generations have paid nothing or considerably less?

I paid for my university...thank you very much.

it was a CHOICE i made ....

"Why should people of previous generations have paid nothing or considerably less?"

huh? Just because a previous generation got something for 'free' or whatever, doesn't mean the next generation should automatically get that...?

So if ALL students get free tuition, no matter what... Why shouldn't I get a free driving lessons? I mean I want to become a taxi driver, so the government should pay for the lessons...

Why should people of previous generations have paid nothing or considerably less?

Because they chose whether to attend or not based on the terms and conditions at that time? Just like students do now. Can’t undo the past or hold it against those who benefited.

I remember how horrified people were when tuition fees were introduced. Barely a generation later, people speak about them as if it's unthinkable that any country should fund higher education at all, even though most of Europe does exactly that,. And now the people have to take out student loans to study nursing.

Where is the slippery slope going next? At this point, it seems clear that if the government stopped funding secondary education and passed the financial burden of secondary schooling directly to children's families, MNers would be willing to argue that it was reasonable!

Spot on Vardy.

Those of you wondering how OP could pay.anything off early. She's 25 on £45k. By 30 she'll be on £60-75k. She might move onto contracting at that point and start getting £90-120k. That is the track that she is personally on, so advice as though she'll stay on £45k for the next 30 years isn't necessarily best for her. As a previous poster said, she could save into fixed bond investments or a high interest limited access account, then she earns interest to counteract the loan and can pay off the lot once she knows she can.

OP - I've also been young, living in London, with (admittedly lower) student loans etc; I was lucky that I already worked all through uni so my debts were low, but I also made damn sure to always live well below my means. You must be taking home £2,700/ month and you should be able to live off £1700 quite easily. Appreciate you want to give some money to your family, but do your sums instead of saying you can't, define a plan with your goals in mind. If some of the savings only kick in with your next salary increase then fine, but have a plan because you are responsible for your own financial welfare.

Of course like most of the country, I didn't have a spare 50k of cash at the age of 17 to pay for uni so was forced into the unfair interest rates..

That's a tad disingenuous, as you don't pay the entire course up front, just the fees and accommodation for the year. The accommodation can be paid termly, if in Halls, as can the fees, even if self funding, but there is normally a discount if you pay the fees for the year all at once.

@scaryteacher

One years worth of loans still amounts to around 15k, an amount I still had no access to.

I worked from the ages of 16 to 18 too and had some sort of salary, but there was no way I could have saved up 15k, or pay £3000 for a term + rent and living with some confidence I could afford the rest of the year/course.

I had zero financial help from my parents, they were not in a position to provide this.

Why on earth should I even have had to consider paying cash when I have no means out of no fault of my own?

In response to everyone else:
One of saddest thing I'm reading from these responses is the suggestion that I should have worked harder. I worked so shitting hard. I had 2 jobs while full time at college. I had zero free evenings or weekends as I was working, and somehow fit in time to revise and do well on my exams.

I did this as I really really wanted to go to uni and break out of this shitty life cycle. The money I saved by working gave me the space to not have to worry about living costs and focus on my education while I was at uni and help end up in the financial position I am in now.

One thing this loan system has going for it is I could at least go to uni. I am very very thankful for that. But it still penalises the working class for going to uni and earn a good salary and that is not right IMO.

And when I say penalise, I mean pay much more for their education than it ever cost. I'm not classifying covering the loan cost as penalising.

It should be putting people off doing pointless degrees like media studies.
Interestingly I seem to remember reading somewhere that media studies has quite a good graduate employment rate. I have a feeling that that's true of quite a lot of the degrees that people scoff at - (golf course management springs to mind as one i've read about).

Obviously salary levels for graduates are also important because they affect future revenue. But on that basis we should be trying to put people off going into nursing, physio, teaching, I think social work - aren't these all careers in which the 'average' student won't pay off the loans?!

I’m another one absolutely bewildered at the idea that by “working through uni” you can somehow avoid getting a loan...

I worked full time in the year before uni (admittedly as a waitress earning fuck all back when they were allowed to pay less than minimum wage because of Tips). I also worked 20 hours/week while I was at uni.

This would in no way have paid for my living costs or tuition fees. It basically meant I had some extra spending money for 2:1 cocktail night at Tiger Tiger...

Why on earth should I even have had to consider paying cash when I have no means out of no fault of my own? Where did I say that you should consider it? Having just funded 4 years of university, I am well aware of what it costs.

It's not just about students from less advantaged families paying back lots of interest though - many of the students who on paper look like they have it made, don't. Either the parents will not contribute their share of the maintenance costs (i.e the shortfall between the maximum loan and what their kids get), or won't give the information for the loan to be applied for.

I've also heard from a friend that her daughter's loan wouldn't be processed until the Dad sorted out his issues with HMRC. Given it's the student applying for the loan, it's interesting that HMRC evidently have oversight of parental income!

Interestingly I seem to remember reading somewhere that media studies has quite a good graduate employment rate. I have a feeling that that's true of quite a lot of the degrees that people scoff at - (golf course management springs to mind as one i've read about).

You're absolutely spot on. I work at a university that offers media Studies. Our employment/further study figure is 98% and our graduate employment figure is in the high 80%. People are quick to scoff at so called 'mickey mouse' degrees but they often have excellent employment figures. I teach a very niche subject and i've lost count of the times people have asked me if it's an actual subject or mocked it.....but I've had 100% graduate employability for years and i have employers begging me for students as they'll employ them before they've even finished.

Well I for one didn't realise this op. I've read your thread with growing horror at what tuition fees and loans have become, it's a scandal. I remember stuff in the papers from when they were introduced yet it sounds like it's got massively worse quietly!

I see what an impossible situation you're in, your numbers are shocking, it's a pit you can't climb out of despite having worked your way into a wage thousands higher than the national average (and outside what's feasible for most 25 yr olds in NOT London).

I'm sympathetic but I can't do much for you. But thought I'd add my voice to say yanbu!!!!

@scaryteacher
Yes. That happened to me here in the US. If your parents make above a certain amount, you are not even eligible for student loans. My lovely parents decided that they could only fund the boys (my brothers) because and I quote “girls have a choice to not work” and “you’d just be husband shopping so an education is a waste”
I got into a good university had straight As, top 1% score on SATs. And that was when I found out my parents made too much money for me to get a student loan and since they refused to give me a penny or even a roof over my head, I had to come up with full tuition ($32k/yr) plus board/rent.
Not all kids from affluent backgrounds have it good....

I got told the same by my Dad and brother ...my lovely husband supported me though my degree the first three years of our marriage.

@scaryteachers
Yep me too. Have an awesome husband.
Horrible you faced that whole attitude too. old fashioned and sexist.

The new dividing line for privilege is paying your children’s university fees up front. I know several people who have done this. Among the big advantages it brings, you are free to work or travel abroad whenever you want to without being followed around for the rest of your working life by the student loan company threatening you with punitive interest rates (or even, as happened to one of my friend’s sons who took a year out to teach English in Japan, being threatened with immediate repayment of the entire sum - I don’t think this happens any more).

I wish I could have avoided this for my children.

And this debt is being packaged up by the government and sold on to commercial loan recovery businesses - in tranches divided up supposedly into people likely to repay and those unlikely to repay. There was a good LRB article recently about this utter scandal - I will try and dig it out to share.