Do I treat DC the same for Uni fees?

[teerocks]

Hi,

2 DC, both due to start Uni this September. DC1 is older and has done a 3 year apprenticeship and so has been told they will qualify as an independent student and get the maximum student loan. DC2 will be fresh out of 6th form and will only get the minimum loan due to our incomes.

I'll obviously need to top up DC2's to at least the maximum loan amount, but morally it feels like I should be offering DC1 the same.

Any thoughts?

I think you should ensure they have the same total amount- so would mean giving more to one of your sons. I haven’t read the whole thread, but there was a really interesting video that Martins money did recently on student loans/finance and the expectations that parents will still need to contribute, even after full loan. Apparently not many people know of this expectation. Could be worth a look x

I'm not sure I agree with those that say to reduce dc1's loan because they will be "saddled with more debt ". Obviously youd need to run the figures, but if the tuition fees are £9k a year and they are also receiving c£8k a year or £3k a year (dependent on child) in maintenance, the loan amount totals are gonna be c.£36-51k before you even factor in interest. Then, you only start paying it back when you earn over a certain wage (some entry level jobs will be below this in the first year), the amount you pay in your paycheck is also proportionate to wage so it would be a long time before they paying even £200 off a month....neither child sounds likely to pay off the loan before it is written off after 30 years...so unlike smaller loans for masters etc it makes no sense to overpay and also the overall size of the total doesnt matter after a certain point as they will never pay it all off? I will likely never pay my student loan all off (and mine was pre 2012 so not £9k tuition but I got maximum maintenance) and so I just see it as having a 'graduate tax' on my salary over the 30 years from graduation. As such, the overall total of my loan doesnt bother me as it doesnt affect how much I will end up paying off. Appreciate I'm not up to date on current student loans, but could this be a possibility in your situation? In which case, definitely dont reduce Dc1's loa and voluntarily pay thousands more if the total debt amount will have little effect

Of course you should give them the same. People saying fair isn’t equal is just a load of old rubbish in this situation. Just because dc1 can get the full loan, it doesn’t mean they should. How is it fair that dc1 has lots more debt than dc2? Tell dc1 to take the same loan amount as dc2 and then give them the same each month and tell them both to get a part time job.

www.moneysavingexpert.com/students/student-loans-tuition-fees-changes/

If anyone is interested

DC1 will be getting enough; you don't need to top up.

Hang on to your money. You can always help with house deposits and so on later on, and take previous support into account at that point.

DC1 will have a bigger student loan to pay back, but if they were to go into something which doesn't pay very well, they might never pay it back anyway, in which case they'd benefit more from you being able to help them out than having reduced their loan.

you supported dc1 in their choice leaving school to go to an apprenticeship

you are now supporting dc2 in their choice leaving school to go to uni

what they do after each is their choice but you have done your bit and it will be as independent adults. this is why dc1 is being given a loan to support them as an independent adult and dc2 you are required to support as a school leaver

you need to draw a line at some point. if you support dc1 with an apprenticeship + a degree, will you support dc2 if they decide to go on after uni and study another degree?

Could you work out what DC1 has paid you by way of “keep” and give them that back, plus a bit more perhaps spread over 3 years? Offer to find a specific item - books, phone for DC1? It doesn’t have to be equal. But DC1 will be shouldering a lot more debt than DC2 at the end of it if they take the full loan.

Equity over equality

I don't think fair is always equal. But will one come out with more debt? I guess I'd want to see that one wasn't going to have to have 20k dept at the end of Uni compared to another 10k debt.

I feel for you @teerocks I struggle with this a bit too though we aren't yet at the Uni years, my dc have very different needs and I can see this continually looking different for us than other families.

You need to treat them equally, but that doesn't mean identically.

So, you may be able to help child 1 in a different way, further down the road, that would be particularly helpful to that child (eg, helping towards them starting a business) rather than just randomly hand over the same amount of money.

Whilst fair is not always the same equal, in this case it is! Your DC1 is not being given extra money. He is just allowed to borrow more if he wants to but why would you make him have more debt than your younger child? I appreciate that currently not all students will be expected to pay back, but there's no guarantee it will stay that way. It very probably won't.

I would make sure they both had the same amount of funds per month after halls are paid. That would be the fairest way to do it, personally.

@Pinpointer

I mean tell DC1 to take the minimum loan and top them both up. Then it’s fair and they both have equal debt at the end.

This

Yes, you need to give them both the same.

Personally I think you should. Otherwise 1 could view it as favouritism.

My parents helped me out. They helped my siblings out. They gave us what we needed, that wasn’t the same for all of us. Favouritism has nothing to do with it.

Bearing in mind part of their living expenses are based on loans which need to be repaid there are two parts to this in terms of seeing both children treated fairly.

• their available living expenses during their university experience
• their financial situation when they leave university

You should top up the amount DC 2 is getting so that the loan part of their living expenses is similar. DC1 may have more disposable income because they have been working and saving but that is based on their hard work and life choices. DC2 will have the chance to work and save in holidays now too.

At the point they leave university will DC1 have a bigger amount to pay back in loans because they have taken the full loan amount each year whereas DC2 has borrowed a smaller amount?

If so then to make things more equal to them both - you could offer to help with a percentage of the loan repayment, so that they are both on a more equal footing with the amount of debt they leave with.

Well DC1 has already had support for 3 years through living at home, thus is better off.

I'd make it nominally a loan (to be repaid when they're able) and make up DC2's money so they each have the same overall.

@Zoecarter

No dc 1 will have more money which is unfair on dc2

I don’t understand how it’s unfair to dc2? DC1 will be getting the maximum loan which it means he will have to pay it all back. Dc2 will be getting a smaller loan to pay back and free money from his parents. If anything it’s unfair on dc1.

I mean tell DC1 to take the minimum loan and top them both up. Then it’s fair and they both have equal debt at the end.

Don’t do this. 85% of students never pay back the full amount borrowed.

Take the full loan and offer to help with repayments later if that is an issue.

@Kpo58

I think it rather depends if you are giving or loaning DC2 the money. If it's a loan, you can treat them differently, if you are giving the money then you should treat them the same.

This is correct. If loaning, you can top up DC2 to the same amount as DC1 but if gifting then they need to be gifted the same. Otherwise DC1 will end up with more debt than DC2.

I don't know how it works but seeing the word loan,if dc1 has a higher debt,then yes,if you can afford it,they should be treated equally.If not,then talk to them and explain.

Don’t do this. 85% of students never pay back the full amount borrowed.

Where does this figure come from? Students who have taken a loan haven't got to the age where the loan is "forgiven" (by current rules) so how do you know they will never need to pay back?. I have read that as things are now 75% won't pay the tuition loan back but the rules on its being forgiven could easily change.

Since DC2 gets a lower amount due to your income, top her up more to ensure they receive the same amount. DC1 is treated as independent because he is independent.

@MyGorramShip

No.

DC1 is getting the maximum loan, DC2 the minimum loan.

You need to make sure they have the same amount of money.

Fair doesn’t always mean equal.

Agree with this

Could you top up the one who gets the smaller loan award whilst at uni, then help the other repay their loan when they do that? That way you spread the cost but also help them more equally?