'Rich students save by paying fees up front'

[QuietContraryMary]

Lol

www.bbc.co.uk/news/education-46866346

'The wealthiest students are going to university in England for the lowest cost, by paying their tuition fees up front, say researchers.

About 10% of students are not taking out loans and so avoid interest rates of 6.3% paid by other students, says the Intergenerational Foundation.'

'Interest charges begin to build up as soon as a student begins at university - and about £6,000 can be owed before a student even graduates.

Those paying up front will leave not owing this money - and they will not be part of the repayment scheme paying back loans over 30 years.

This will give self-funders a "serious economic advantage" when they leave university, say researchers.'

This is rather silly.

Firstly the interest rate is only 6.3% during the course, or if you are on high earnings. If you are on very high earnings then your debt will get repaid. If you are on low earnings then it will never be repaid and the rate is any case only 3.3%, so the rich students never saved anything, since, well, you got fees + maintenance loan and you never paid them back, whereas they paid for them out of pocket.

The issue really isn't with the 6.3%, but with the fact that if you can pay for fees up front you have lots of money, which is hugely advantageous quite irrespective of university.

Or written off when repaid, which apparently 60% of students do in full (plus interest, unless you pay up front, which 10% do). So yes, it is very flexible for the individual, but it doesn't seem to be working for universities - they think the taxpayer is not covering enough of the cost of putting increasing numbers through university. So where next, if the graduates themselves are not paying enough "tax"/repaying enough of their "loans"/being asked for large enough fees?

And rich people buying homes without a mortgage also pay less except you pay a mortgage whatever you earn but the student loan only gets paid back once you earn over a certain amount. Lots of people won't earn over the threshold so will never pay it back.

But it relies on those who aren’t rich knowing their place and not aspiring higher.

It is incredibly difficult to get on the property ladder if you don’t have the bank of mum and Dad. Most will aspire to earning more, supporting children and owning a home. Clobbering families when they are getting on their feet and trying to do all that is shit. You will be severely limited on what mortgage you can get and thus what property you can buy if you have to pay £200 a month on a £55k salary.

It’s the same old bracket the Tories like to screw. Those just getting their heads above water after several years of work.

Now free education via Europe is going to be shut off too with Brexit.

Social mobility my arse.

We will have 3 teens to fund as they won't be eligble for the full loans on living expenses.It is going to be a struggle. If we had to pay £200 a month for our own fees on top of a more expensive mortgage( due to higher outgoings and student debt history) they wouldn't be going.

Nordic you have to be earning over 50k to be paying £200 a month. On average wage you are paying around £30.

Yes unless students live at home the maximum maintenance loan can be less than some halls of residence which is another issue although many students have holiday jobs which help them make up the difference.
Labout brought in the £1k fees loan but also the need for al oan for your rent. At present 1. the fees and 2. the rend and food etc are both pretty high sums. When fees were £1k only (when my daughters went) they still had under Blair masses of rent to pay too which again most people took out loans to cover. In fact even in my day I got the £50 minimum grant and my parents made it up to £900 a year to cove rmy halls rent.

I compared my halls rent in the 80s recently with rent in those halls now in the same place, same halls and allowing for inflation. the rent for the same place is 3x as high (after allowing for inflation) today. That is university owned self catering accommodation/hall and it is no different inside than when I went but someone is now making a lot more profit from it or else they are paying a lot more wages to those who manage it.

Yes but many get to 50k further down the line after years of work.

The fact remains that being clobbered then for a quite significant amount is shit.

It’s graat if you start on that, probably with your private education and house deposit from mum and Dad. For those that start from the bottom, work themselves up when they finally get there at a really expensive time of life they will be quite heavily burdened. We will want to start paying more into our pension too after being bled dry with kids’ uni living expenses. That wouldn’t happen if we were paying back our student loans. Dh has 2 degrees which got him his salary. Took years of graft. Lord only knows what two would cost per month to fund.

I really think those not already rich but aspiring to better salaries will need to think long and hard. Property, pension, getting your own kids through uni on top of paying for your own loans.You won’t be able to have it all. On top of the CB we’ve lost and higher tax I actually think when you add up everything we’d have been better off keeping in our places, forgetting uni and keeping to a lower salary. Ensuring you keep under thresholds seems to be the way to go.

We’ve also got elderly ill parents to sort out. That issue will rear it’s head nationally for our kids too alongside paying more for education and health( privatised NHS) if the Tories are enabled to carry on in the same vein. They will not be able to fund it all.

In Denmark they pay students to go to uni. Everybody gets s fair crack of the whip. Everything about our country is outdated and needs a massive overhaul, it’s all so shit.

N0rdicStar I think you'll find the Tories are seeing to that too. Under Labour's tax credits you could have a million quid in the bank and still get child benefit, £10k tax credits and just have a nice part time job a short walk from home.

Under Universal Credit that has all gone - you don't get a penny if you have savings, and the government have raised wages and reduced repayment thresholds so that there is less money coming from the government. In addition, once your kids are 13 you are expected to work full time. This won't do anything for your take home pay (ok you keep about 23%) but what it does is mean that the government is not paying.

I agree that people in the middle are squeezed quite hard, despite more people being in work now than since the 1950s. Those on the lowest pay had a pretty big rise in the minimum wage. Those in the middle other than the much higher single person allowance (I don't even get a single person allowance never mind any child benefit) have quite high taxes and higher earners are currently paying the largest proportion of the tax burden ever (even compared with the very high taxed 1970s years).

A lot of the old certainties - that if you worked hard like my doctor father and teacher mother you were all in this together,got your child benefit/ mortgage interest tax relief, substantial pension tax reliefs, free university education for the 155 who could go.

When you strip out all the benefits middle class professional get they lose their buy in to the welfare state and their support of it and it becomes a different ball game. Will work until I die. Half my state pension will go in income tax and the other half will just about cover my £3200 a year council tax so thanks for that for continuous paying of NI working full time since 1983 until ti m a 67 and then in effect I get virtually zero.

I had loans under the old system and still had £30k of debt that I’ve recently paid off. I think the concept of life long debt/graduate tax is really unfair for current students. Before kids I was paying nearly £400 a month in loans. Yes that means I was earning well but that is a significant chunk that I would have been paying for many more years under the new system. As I was under the old system, I was able to pay back my loan just as I was hitting childcare costs. It made a massive difference. I’m also not sure raising the repayment threshold is as helpful as it seems. I started paying back over £15k so my first grad job whereas lots of graduates now won’t start repayments for a few years until they hit the payment threshold but they’ll be accumulating interest.

The thing that is really unfair is that masters loans are stacked onto undergrad ones. I’ve had graduates that will be paying 15% of their income over the threshold for decades. For me, that is just too high.

It is becoming a big issue in the USA particularly (and their loans are worse as they are at commercial rates rather than "only" 9% of salary over £25k. qz.com/1367412/1-5-trillion-of-us-student-loan-debt-has-transformed-the-american-dream/

(I paid one daughter's law school fees - post grad. The other had a law firm who paid them - so you are right that undergraduate years are not the end of it all for some).

So if you do not borrow money you do not pay any interest. Is that news? Houses cost less if you do not need a mortgage.

The fact is student debt in the uk by March 2018 was over £100 Billion. This can only increase and will affect the economy for us all.

The Government thankfully at long last has decided to write the state's cost of these loans into our nation's accounts. Until now they have been conveniently not counted! www.theguardian.com/education/2018/dec/16/change-in-student-loan-accounting-could-add-10bn-to-national-debt]