to think that mums should get some sort of concession for student loan repayments?

[bubbleymummy]

I just got my student loan statement and yet another big whack of interest has gone on. I haven't been able to make any payments since I went on maternity leave 3 years ago because I only worked PT after ds. Now I have ds2 and who knows when I'll be back to ft work. dh on the other hand has paid back over half of his. It just seems a bit discrimatory to me...most women will have to take a salary drop at some stage to have a family and won't hit the threshold for repayments while the interest just piles on...shouldn't we get a bit of a break?

Surely part of your plan beofre you went into a student loan situation, should have been "How will I pay it back/ not incur long term interest on it, if I have children and don't work".

It was your CHOICE to take a loan, your CHOICE to have children, and it's still your CHOICE not to work, or work part time.

Part of your analysis should have been - is it economically viable for us as a family to take out a loan and have the interest accumulate if I don't work, or only work part time?

It's not up to us, the tax payer, to subsidise your choices. We are doing so already by the tax we pay for the loans to be there in the first place- how and when youpay it back is down to you.

and just because you took it out at 18 makes no difference.

some people at that age really do think, 'i don't like debt' and so don't take out loans.

plus, we all make mistakes financially; poor choices, bad judgement calls.

doesn't excuse the consequences of those decisions, unfortunately.

I guess we'll just have to agree to disagree then.

BG- you are bleating because the system doesn't work as you would like it to- that's not to say the system is wrong though is it?

It would be incredibly unfair to make this a gnder issue, as it work fly in the face of the equality that women have fought so hard to gain.

Another option you had- and I am not sure how old you are now- would have been to have put having children on hold until say your early or mid 30s, and paid off a lot of your loan by then. (apologies if you have done that!)

In your situation, if your DH earns a lot of money which is what you seem to say, then why can't you use some of that to pay it off?

It's no different to a loan for anything- whether that's a house or a car- you can't expect interest to be frozen just because you make another choice, which results in your not paying it off as quickly as you would like to.

Stop sending so many people to University. Only send people who need a degree. And give them a grant. Don't agree with the old system of means tested grants either though - everyone should get the full grant. I remember when I was at Uni, all the rich kids with divorced parents got the full grant because mummy sat at home all day, while those with two parent working who stayed together got barely anything.

The answer is to stop pretending that 50% of the population need a degree, and fund the people who do need them properly. Hopefully the incentive to then 'pay back' to society through working in a useful and higher earning career will then be there without the threats of paying back loans.

I agree 100% with VH.
In the olden days when I went to uni, I got a means-tested grant. But then, only a fraction of the population went into higher ed- between 7-20%.

Degrees have now been devalued because so many people have them- and they don't always use them in their employment anyway.

I think that it would be good to go even one step further- have grants for degrees that are beneficial to society- such as doctors, teachers, engineers and whatever else there is a shortage of, but if you want to study golf-course management, then fund it yourself and/or get a loan at the going commercial rate.

I think the present system may eventually be self-regulating, as more and more people realise that the loan they have to pay back outweighs the value of their potential degree, and that a degree is no longer a guarantee of a job, especially if it not in a shortage subject like engineering or science.

"I don't think it all just boils down to the choices we make"

So why exactly do you think that?

I started my degree in IT when the industry was booming. Average starting salaries were 20k+ - no problem paying back the loan I thought! By the time I had finished you were lucky to get a starting salary over 15k if you could get a job. fwiw I would have worked longer and paid off more if ds1 hadn't 'surprised' us So you can't always sit down and plan how long it will take you to pay back etc. The economy can change v quickly - look what's happening now. I feel v sorry for all the students graduating this summer...

qc - I mean sometimes the choices are out of our hands - like in Riven's case.

BM- the economic picture will always chnage over 3-4 years. When I left uni I had to move 350 miles away from where I thought I would be working, in order to find work.

My DS is now umemployed ( hopefully it will be short-term) with student debts of around £30K and a masters degree in a subject which he was sure would have him destined for top jobs in the City- until the recession hit.

I don't think you can expect to change a system just because it is making life a little bit harder for you- and because you had a "surprise" baby. Again, an element of choice was there, as was your choice to have baby no.2.

I think in your case, you have to accpet that you are CHOOSING toput motherhood first and that this will mean you accrue more interest on yourloan. It's dead simple really.

But we're all vulnerable to that aren't we bubble? One of my dc's was born very early, requiring specialist care, which meant that I had to change my plans for returning to work in the same way that I did after dd1. And one of our children was a ..ahem... surprise! ... which meant all our financial planning went tits up. Life can throw these things at you - no one is immune. You just have to get by as best you can.

Well, that's life. Some people had careers in something which is now totally redundant.

It happens.

Doesn't mean everyone from one particular subset (mothers) needs a break from reality because of it.

httm - i don't think the situation should change just to suit the change in my circumstances. I do genuinely think the system is flawed - I just happen to be aware of it from my angle because I'm a mum and I'm not hitting the threshold. I'm sure there are others out there who are unemployed or are in jobs earning less than they thought who would argue it from their perspective too.

I would have much preferred a mortgage-like payment where the amount I borrowed was spread over x number of years so I knew exactly how much I had to pay back. If there was an accelerated option - even better. Pay back more when you earn more and pay less on interest as a result. To me, that is much fairer than having a variable amount of interest tacked on over the years determined by my circumstances. The slc are making more money out of women because, lets face it,women are going to have kids and they will have to take time off for that and they will prob spend more of their working years earning less than men. I think it's unfair - clearly most of you disagree - oh well! I won't let it spoil my sunny sunday

BG- I think you draw too many generalisations.
Not ALL women who have SLs will become pregnant, or stay at home with their child if they do.

As the re-payments only kick in after you earn over £15K, are you saying that the interest still goes up annually or whatever, even when you are not having any repayments deducted from your earnings?

If that is so, then that seems unfair to everyone- not just women.

I was not aware either that you could not pay-off part of the loan with a lump sum, or overpay. I presume this is the case (if it is) to make the administration simpler ( though not necessarily fair.)

From the SLC website

"These loans accrue interest at the rate of inflation, which means that the amount repaid has the same value as the amount borrowed."

Interest on student loans currently stand at 1.9% per annum. Working out how a couple of grand of interest could be "tacked on" over 9 months' maternity leave means that the OP has borrowed over £140k in student loans. Phew, you must have had a riotous time as a student.

You agreed to the terms of the loan when you took it out. You signed on teh line and took the money.

If you then conclude that the terms were unfair, that's well, tough. You still pledged to abide by the terms in exchange for the money.

Your other option was not to take out the loan at all but you did not chose this option.

'The slc are making more money out of women because, lets face it,women are going to have kids and they will have to take time off for that and they will prob spend more of their working years earning less than men.'

Eh? How do you know for sure they are making more money out of women than men?

Men have SLs, too!

And some women work their way through university, don't have kids, don't take time off beyond their full whack payment, earn less than men.

You agree to what you agreed to.

Don't like it now? Well, I think the lender's response is to tell it to the hand.

Basic question- does the interest keep being added on, compoundly , even if you are not earning above the threshold for repayments?

I suppose I can see that on the one hand, it is an incentive for people to get a job ( the thing we hope their tax-payer funded degrees will are for), but on the other hand it's abit of a double whammy- no job paying much and loan increasing all the time.

However, BG you do know that if after 25 years you are still not earning above the threshold, the debt is wiped away?

Yes it does but the rate of interest is incredibly low. It only keeps pace with inflation.

So, if you had a loan of £20k, which would cover a normal undergraduate degree, the interest charged would be £380 per year. For nine months, the interest cost would be £285.

I want a student loan ... It's the cheapest form of finance going.

wow, where can we sign up? we need a new old car soon. our banger's starting to crack up in a big way here

HTTM, yes, the interest is added on from when the loan is drawn down, so students accrue interest while they are at university.

Interest also continues to be added throughout the life of the loan whether or not the person makes any repayments to the loan.

And the interest is compound interest so students are paying interest on the original loan they took out, plus interest on any interest that has already been added.

You are being ridiculous.

The loans work like any normal loan with a variable rate of interest (which is pegged to inflation). The only difference is that you have the chance to take payment holidays if your income is below 15K.

If you have a mortgage (which can also have variable interest so the amount you pay back isn't always fixed there either) and take a payment holiday then interest is still added.

You made a decision to:

1. work in a sector where graduate pay was so low (the average graduate salary 2008 was 22 001 - 24 000, according to prospects)

2. have TWO children

3. not return to work.

I don't see why as a tax payer who has worked solidly into my 30s prior to having children (so have paid of my Student loan) I should subsidise you.

Sorry.

WHy on earth should I a working mother supplement women who choose not to work??Barmy!

Thanks PL- I do understand what compound interest is thanks! ( good old 1960s arithmetic lessons!)

I suppose, ther eis nothing to stop a student getting a loan from another source and then they can repay whenever they like, however they like? Won't be so cheap though!

we re-mortgaged to help pay my son's masters course- so it is on our mortgage and we can over pay etc whenever we like (or rather he can pay when he gets a job!)