To not feel very sorry for some student loan whiners

[Viviennemary]

There's been a lot of complaining about student loans and its wrong they seemed to have move the goalposts re paying back. StillI I read about this woman complaining her student loan is £120k and is going up every year. She was a student for 10 years fgs. Just as well the tax payer wasn't funding her. I hope these folk arent just going to be let away with not paying.

We have the worst of all worlds

yes

@EstrellaPolar So who should pay? Everyone else? They should fund you to get a great job? You came here and then went abroad. Look at the advantages you have? The degree has given you everything. You chose to go abroad and the country doesn’t owe you an education.

We have around 37% of school leavers going to university. We had 10.% or less in 1970. Of course we had to change funding. We opened a massive number of universities and our goal was to fill them up. If some people have better off parents, so be it. However the majority don’t have the fee money lying around. You are envious but they are not a majority. Years ago it was more difficult for poorer dc to get near a uni! No aspiration and staying near family often stopped people bettering themselves. Universities were very much bastions of the middle classes with educated parents. We should be pleased this is no longer the case.

Hear hear👏

I think worst of all worlds sums up issues well. It's a structural problem with education for me rather than a problem with loans as such.

I think plan 2 is worse than plan 5?

My ds is looking at going now - he'd quite like to teach. Its definitely middle earners hit the worst In repayment terms. Low earners dont pay much a month and if you earn over 66k it starts to make a dent in the loan amount and you pay it off. But that middle range is the full 40 years of a noticeable sum each month.

It really does mean big graduate professions like nursing and teaching end up paying the most, but there are many graduates jobs in this bracket too.

We also looked at staying at home v moving away. But when I ran repayments with and without maintenance loans on an average wage that rose each year with inflation you paid the exact because you werent paying the loan off anyway. When I ran the figures earning a higher salary it was about 2-4 years quicker without the maintenance loan so we ended up feeling if he needed the tuition fee loan he may as well take the maintenance loan, especially if it meant a better course with better prospects. If he ever earned enough it was actually paying off thd loan he could over pay to clear it. But as people say, you get made redundant or need time of sick and it builds up again..

There must be a better way of funding ot all as it does seem to act as a disincentive.

My ds has tried without a degree and as much as there arent any graduate jobs, there also isnt many non graduate jobs either. He currently does 4 part time jobs and hopes the degree leads to one job with nicer conditions. If you do lots of part time jobs you often dont even get auto enrolment in pension schemes as you are under 10k.

Personally that’s what i’d tell my kids, as it doesn’t pay well, so why get into all that debt? Yes it’s great people do, but in this climate you’re going to struggle in a low paid career.

There are no debts that must be paid off! Most don’t and for some, they never get near to paying the initial sum either. However changing the goalposts is wrong. But these costs cannot be borne by general taxation - we could reduce the sector of course! Fewer do degrees and more do cheaper HE near home as other countries do.

Apprenticeships are going to be the way forward. People with degrees are losing their value now. Unless it's leading into something vocational which is a great benefit to society such as medicine.

And if we are talking about an educated society what do we actually mean here? A lot of criticism has been levelled at how younger generations have been taught to pass exams rather than think critically or apply practical lessons to real life. Or have practical life skills generally

An educated society encompasses many things, going to university is not just about a qualification but I think there are other aspects you are exposed to that are valuable.

What was expected of 14 year olds as a society is massively less now than it was decades ago and I think we should be thinking about this as much as thinking about university education as there's actually links to the state of society as a whole on many levels.

Which time period are you comparing too? I certainly think today’s 14 yr olds have more pressure than I did.

yet we had many people who achieved professional careers who left school at age 14 or 15 who will eclipse this generation of degree educated kids

But this isn’t just because of degrees, wage stagnation & housing costs means many won’t be in the same financial situation as me or my parents. Education is still the only way for some to get out of poverty.

Our whole education and employment structure is off. And tbh I think this is where issues really lie rather than actually with faults in the student loan system itself.

I agree that there is a wider issue but I still think the loan system is shit.

My tuition fees were slightly subsidised so instead of £1,100 a year I think it was about £1,000, I did a placement year in 3rd year (fees were half that year) I paid the fees in 3rd and 4th year (from my earnings) and my parents paid y1 and y2 all up front. I also got a maintenence loan of £3,500 for 3 of the years. I didn't start paying it back properly until I had travelled for 18months, did a masters and a PhD (that was funded and I received a tax free bursary so I didn't start paying my loan back despite earning), so quite a bit of interest was added over that time, I think it was about a pound a day over 7 years or so a good 3k. So it probably went up to about 14k, so still not that much and of course I expected interest to be added over that time. Students now leave with eye-watering loans more than the cost of my entire degree for 1 years study now, my parents didn't need to send me extra money either (they aren't wealthy and couldn't afford to), I managed very well on my maintenance loan and a pt job, plus what I saved on placement year allowed me to give up my pt job in final year to focus on studying.

It's so so much harder financially for someone to go to uni now than when I went nearly 24 years ago, I highly doubt I would have been able to go had I needed the amount of financial support they need from parents now. Many students now have no hope of paying off their loans, they will effectively have an extra tax for life, which is shit when housing is so expensive and they could do without paying £150+ or whatever per month for life. I think it's really unfair and I do feel sorry for them. Don't even get me started on removing the bursaries for nurses and midwives etc, it's no wonder there's a shortage who on earth wants that debt for a nurses salary?!

They are fantastic but so few if them so many young people i know want one (I work in an FE college too) but there arent anywhere near enough on offer. There are a lot more level 3 apprentiships than degree one, but again young people are competing with adults for these them.

We need employers to really get behind apprentiships and expand them rapidly.

We have around 37% of school leavers going to university. We had 10.% or less in 1970.

But how many of those jobs in the 70s required degrees?

Anyone who made clear it was a student tax was wrong, since if that were the case it would also apply to those who didn't have parents rich and willing enough to pay upfront. And 9% is rather a lot of tax to be able to opt your kids out of.

Personally I find it rather frustrating whenever anyone is dim enough to refer to this as a student tax or similar, when actually a student or graduate tax would be much fairer because it wouldn't opt out the rich and/or older.

I think you’ll find the over 50’s have been working and paying their pensions all their lives! older people generally had more children that add to the work force. Young couples have less children at an older age which results in less working population .. that then has an impact on pensions .
(of course childcare is a huge cost and impacts on affordability) .
My dad worked from 15 years old, paid his NI. Stamps and paid into private pension . He lost 2/3rd of it due to some financial crash . He’s now 78 and deserves every bit of his modest pension.
if you’re lucky you will get old and will want to claim the pension that you contributed to.

I keep seeing the difference in numbers going to uni and being highlighted as of course can’t afford it now - but that 10% were just those going to university to get a degree- not all people going to higher education post A level.

In the -1970s, you could go to nursing college, this was a post 18 higher education qualification that was funded with the same uni grant system, but wasn’t a degree, wasn’t university, didn’t count in the 10%. You also could go to teacher training college - 3 year qualification that required A levels to get in, but not a degree, (pretty much all primary teachers did this route, not university).

Im sure there’s others I’ve missed, but this idea that only 10% going to uni in the 1970s vs 37% now means that only 10% in the 1970s were going into higher education funded by the state is not correct. (For nursing and teaching, the numbers getting qualified in a higher education institution have fallen, just now they are counted in the uni figures when they weren’t before)

I was the first year on plan 2, I did a four year degree and currently owe almost £70k. I’ve been paying it back for 10 years but it is only going up, especially with two maternity leaves.

I was the first in my family to go to university with no family support, I had the maximum loan and also worked 20 hours a week to fund the car that was a requirement of my course. During my placement year I worked full time on £3 an hour and worked another 25 hours a week at a pub to afford rent and used to buy food out of my tip money. I don’t think anybody could say I didn’t work hard enough.

It seems a shame to put barriers in the way of teenagers who want to work hard and achieve something for themselves to improve their families position. The government shouldn’t be profiteering with huge interest rates on the ambitions of usually poorer, young people.

I’m lucky that as it stands, I’ll be able to pay for my children’s university costs up front for them. I might just pay off my loan in the remaining 20 years depending on the interest but it is another cost difficult at a time when we have small children with nursery bills.

People talk about trades as a decent alternative but I don’t think it’s that simple. Lots of trades involve self employment so straight away you lose a lot of potential benefits vs employment. The pension age is already 68 & may increase, it’s hard to do manual labour as you age.

One of my school mum friends DH has just had a heart attack & needs a bypass operation. He is a SE plumber & has to wait a few months & cannot work. Compare that to someone who gets decent sick pay, critical illness etc through their employment.

The situation is usually that you have been paying for some of the annual interest, but not all of it and you haven't paid back any of the actual loan at all.

I suggest that you talk with your bank advisor and figure out wether you should start paying more or see if you can use another loan with a smaller interest rate to pay the loan in full.

I’ve posted before on other threads but mine is £118k now, 6 years after I graduated. I started paying it off with my first job and now pay about £260 a month towards it but it is still going up every year.

@Ocean67- no, the over 50s paid for the older generations pensions, it wasn’t a savings pot they paid into for themselves. And the baby boomers had more of them paying out for a much smaller number of pensioners, who lived shorter lives so didn’t need funding for as long. If it was just a savings pot the baby boomers had paid into, given how many of them there are, how long their life expectancy is and how little they paid into it, most wouldn’t get anywhere near the state pension back.

What I don’t understand- is why a government backed loan for education needs to have interest applied to it at all. Why does the government need to profit from this?

Student loans should be more an installment plan, with not interest applied at all. You borrow £25k, you pay back £25k. I would accept a £500 fee to cover admin. There is no justification for higher education funding to be treated like a mortgage or a private loan.

Those who can afford to pay up front should not get to pay significantly less than those who can’t afford to do that.

Is that pressure on 14 year olds coming from education though?

When I was 14 (many years ago now) I was pretty capable. I could cook a family meal, was able to run a house day to day, worked after school so could function in a workplace working with the public. I could organise myself for school and work, study and achieved decent exam results at 16. My friends were all the same in that there was an expectation they had Saturday jobs, could help at home and keep on top of their studies.

There wasn’t the pressure to go to uni, it was one of a few different options and my parents took the “do the best you can” attitude to school.

The pressures now are very different, but I don’t think young people are more capable as a result. The idea that missing two days of school would undermine your exam results just wasn’t a consideration. No one cared what colour of socks you wore much less being disciplined for it. We didn’t have ever present social media which has created huge social pressures and expectations. There certainly wasn’t the pipeline of tests, exams and measures from primary school through high school into uni that there is now and I don’t think young people are better for it.

It's not a graduate tax. Tax goes to fund services for society. These repayments go to fund a commercial operation. It's the interest rates that are the issue. The money lent to students should only be at cost not commercial interest rate.

Apprenticeships in traditional trades, tend to be male dominated, often requiring significant strength (my DD is 5ft 3in and 55kg, she isn't going to be hauling a cable drum or fitting a db glazed oak window) and what carpenter/plumber/electrician is going to train up a young person who then leaves and sets up a competing business???

NHS apprenticeships aren't really practical as the existing staff haven't the time to mentor the trainee.

Im sure there’s others I’ve missed, but this idea that only 10% going to uni in the 1970s vs 37% now means that only 10% in the 1970s were going into higher education funded by the state is not correct. (For nursing and teaching, the numbers getting qualified in a higher education institution have fallen, just now they are counted in the uni figures when they weren’t before

Good point & so often overlooked as you say.