View Full Version : Student Loans
Just looked at the SLC site at the interest rates on the loans which us students have. Seemed ideal in 2001 when i initially took mine out - only 2.3% and it has been between 1.3% APR and 3.2%APR up until this academic year. This year it has jumped up to 4.8% APR! I still owe the majority of my loan as I only appear to have paid the interest off in the last 4 years of work.
Anyone else suffering a similar loan burden?
squirrel_hunter
07-02-08, 01:32 AM
Anyone else suffering a similar loan burden?
Yes.
There is much to say on this state of affairs...
phil24_7
07-02-08, 02:47 AM
Me too but I tend to ignore it and hope it will all go away.
I'm on the old style student loans as well as the new style so at the mo I'm only paying the newer one back.
Yup.
I just leave it alone and forget about it. It will eventaully get paid off.
I do however wish I never got it, I never actaully needed it. Had some good nights out though :-D
yes I am in a smiliar postion although now i am a student again i dont have to worry about it until I graduate again in July. I dont actually think that it's a loan that i will be able to pay back in my lifetime though.. roll on 50 when it gets written off ;)
Alpinestarhero
07-02-08, 08:36 AM
Rob - I have yet to start repaying mine, and I am due to receive one last installment. I thought the interest rate where ment to be quite low (les than 2.5%); over 4% is stupid. Anyway, I was talking with my parents about all this (I am constantly worried about paying it off) and they said just pay off what you are asked to each month; the debt gets cleared by the time you reach retirment age anyway (or so I have been lead to beleive).
So try not to worry about it; the guys on here have told me its not a "bad" debt to have, its like a morgage in that its an acceptable debt since its sort of nessacery (i.e. you cant get a house without a morgage, and most poeple cant get through uni without the student loan)
Matt
I paid a massive chunk of mine off this month as when I finally got my statement through for last year I'd paid £376 in interest and paid £390 odd off the loan. So this year I paid a grand total of about £14 off a £13,000 loan. TBH I just want rid of it, the interest rate has jumped up a lot this year.
Dualcyclone
07-02-08, 08:49 AM
I had quite a large loan when I finished uni, and my parents decided to pay it off for me - despite me telling them that the interest rate is still very low.
If I could have afforded uni without the loan, I would have plopped the whole lot into an ISA and let the interest from that pay off the loan - the loan rate is still low compared to interest in ISA's.
However - it is rediculous how they have been allowed to bump up the interest rate when the BoE interest rates have been dropping.
Out of curiosity how much are your loans for?
When I started uni back in '92 I had a full grant of £2400. By my final year the grant had diminished to about £1.5k a year so I left uni with an o/d of £1400 & about £3-4k in student loans.
Ah, the good ol' days when you changed your bed sheets once a year (i.e. when you took them home for summer).
Alpinestarhero
07-02-08, 09:11 AM
Dirk, my loan debt will be pushing over £20k...4 years course, with the maximum loan given to me each year. 5500+5500+6500+6500
ouch
Matt
Warthog
07-02-08, 10:24 AM
It's because they suddenly decided to link the interest rate to the RPI rather than the CPI. Whether that is justified or not, it is crippling to students. :(
Luckypants
07-02-08, 10:40 AM
Yeah, which is rather unfair seeing as the government prefers to measure inflation using CPI rather than RPI.
Wish I could help my daughter out more with Uni costs.
Mine is for 9k. I pay £75 13 times a year (4wkly payments) so it is actually just shy of a grand a year for me.
blue curvy jester
07-02-08, 11:05 AM
Only the new style stoodent loans get written off at 50
old styles stay till you DIE
But you need to be on about ?18500pa to have to start paying old ones off
not the ?1 on new ones
also you are correct the loans even if you don't pay don't count as 'BAD' debt as they are garenteed by the goverment ( like northern rock)
and will not be deducted when you apply for a mortgage etc :study:
Warthog
07-02-08, 11:37 AM
Yeah, which is rather unfair seeing as the government prefers to measure inflation using CPI rather than RPI.
Wish I could help my daughter out more with Uni costs.
It's so hypocritical, they split the inflation rate into two, so that they can adhere to which ever one suits them best for each specific case. My pay went up in line with CPI, yet most food and rent went up at the RPI level. :nomore:
SoulKiss
07-02-08, 11:37 AM
Why all the winging ????
If you cant/couldnt afford it, shouldnt have done it.
Simple
Mine is for 9k. I pay ?75 13 times a year (4wkly payments) so it is actually just shy of a grand a year for me.
That is exactly the same situation as my girlfriend. Same amounts and everything :(
I somehow managed to work my way through uni without any loans or grants by working 15hrs a week. It probably effected my grades a small amount, but i got offered a job before finishing uni anyway.
When I see topics like this it makes me glad I didnt bother and struggled abit :(, I would be stressed to death if i was in alpinestarhero's shoes. Are you in line for a very well paid job after your degree?
I had a job too Graeme working 15hrs a week, I just lived better as a student fo that.
Im not complaining about the loan, however the interest rate on that which im now paying i am, as the government made promises about this and have gone back on that.
Tim in Belgium
07-02-08, 12:30 PM
Why all the winging ????
If you cant/couldnt afford it, shouldnt have done it.
Simple
It's pretty hard to get through Uni without one as there are no grants these days. Yes you can work during the holidays, but going to Uni costs now. The real question is who pays, the individual, the tax payer, or both. Got a big student loan myself which I'm paying back, not too bad as being a chemical engineer the job pays reasonably well straight out of Uni, but I think for people going in to lesser paid jobs combined with the current rate of interest means the loan could be eating out of their wage packets for decades to come.
Ceri JC
07-02-08, 12:49 PM
Yes. In spite of paying them a fair whack it seems to only have covered the interest plus about £100 over the past couple of years. Seems a bit off for them to have upped the rate as much as they have, when I took mine out I was under the impression it'd be negligible interest on it forever.
SoulKiss
07-02-08, 01:00 PM
It's pretty hard to get through Uni without one as there are no grants these days. Yes you can work during the holidays, but going to Uni costs now. The real question is who pays, the individual, the tax payer, or both. Got a big student loan myself which I'm paying back, not too bad as being a chemical engineer the job pays reasonably well straight out of Uni, but I think for people going in to lesser paid jobs combined with the current rate of interest means the loan could be eating out of their wage packets for decades to come.
Cant afford it, dont do it.
I didn't go to uni, I could have if I wanted to - had the grades and my folks had put the money aside for years to make it possible.
Why does EVERYONE in the country need to have a Degree anyway?
What use is a degree in Geology or French if you then end up in an Insurance Co (those are the degrees that a couple of the Management Trainees had in the branch I worked in)
I can see the point of Doctors, Dentists, Lawyers, Engineers, Chemical Scientists etc getting degrees but some of the Degrees out there just seem stupid.
I think that the proliferation of degrees is actually damaging the system, I remember when places like the Robert Gorden Institute of Technology in Aberdeen (RGIT) became Robert Gorden University (RGU) and could then convert the various vocational, and practical technical qualifications it handed out to being Degrees.
Now without putting down the qualifications, a Degree sounds better than a Dimploma (or Certificate) but there IS a difference in the two.
What we really need is the return of apprentiships so that people with talent can get a job and the training they need to do that job while not having to be forced down the route of Loans etc.
gettin2dizzy
07-02-08, 01:00 PM
it was always meant to be inflation-tracking. Mine will be over 20k by the time I leave, getting a job isn't an option when you do an intensive course (like engineering) except through the holidays. It's a bit of s sh*tter
Cant afford it, dont do it.
Why does EVERYONE in the country need to have a Degree anyway?
What use is a degree in Geology or French if you then end up in an Insurance Co (those are the degrees that a couple of the Management Trainees had in the branch I worked in)
I can see the point of Doctors, Dentists, Lawyers, Engineers, Chemical Scientists etc getting degrees but some of the Degrees out there just seem stupid.
This is exactly my position on it.
I went to uni as the jobs I wanted to do needs you to have a degree and qualification to even be recognised and to become chartered, without one you simply wont get a job.
My apologies if anyone does any subjects like Art or ClingOn Language, but I just dont see the point in it. I know 3 people who have done art degrees, they have £15k debt and no jobs so they just travel and claim they will never get a job.
It stupid degrees that are pointless and not required that have brought down the respect that a good degree deserves.
SoulKiss
07-02-08, 01:21 PM
This is exactly my position on it.
I went to uni as the jobs I wanted to do needs you to have a degree and qualification to even be recognised and to become chartered, without one you simply wont get a job.
My apologies if anyone does any subjects like Art or ClingOn Language, but I just dont see the point in it. I know 3 people who have done art degrees, they have £15k debt and no jobs so they just travel and claim they will never get a job.
It stupid degrees that are pointless and not required that have brought down the respect that a good degree deserves.
And those jobs that you are now qualified for SHOULD allow you to comfortable pay off your Student Loan in a timely manner.
I think that perhaps a light has gone on in someones head in Government that they realise what their "Degees for all" policy has done and they are now trying to scare people away from Uni.
phil24_7
07-02-08, 02:47 PM
Only the new style stoodent loans get written off at 50
old styles stay till you DIE
But you need to be on about ?18500pa to have to start paying old ones off
The old style loans get written off after 25 years if not paid and the amount you need to earn before you start paying has gone up to over ?20K now!
squirrel_hunter
07-02-08, 07:48 PM
Why all the winging ????
If you cant/couldnt afford it, shouldnt have done it.
Simple
Not quite that simple. If you have to pay your way through Uni then you need a loan its not a choice.
When I did it tuition fees were £1500 a year and your rent could be around £3000 a year, not including food or money for books transport etc. A loan gave you £3000 a year which would cover the fees, but that meant you just halved your loan. To cover everything else you need a job. I worked 25 hours a week and did a degree, I now have a job using my degree and a huge mountain of debt.
Why does EVERYONE in the country need to have a Degree anyway?
...
What we really need is the return of apprentiships so that people with talent can get a job and the training they need to do that job while not having to be forced down the route of Loans etc.
I do agree with this there are to many 'Micky Mouse' degrees in my opinion. But there is no way I could be doing what I'm doing now without one so for me it was worth it.
And those jobs that you are now qualified for SHOULD allow you to comfortable pay off your Student Loan in a timely manner.
I did a bit of maths, I have an average loan and an average graduate job for my industry, would you call 26 years to clear the debt at the current levels 'timely'? I wouldn't.
metalmonkey
07-02-08, 07:54 PM
Just looked at the SLC site at the interest rates on the loans which us students have. Seemed ideal in 2001 when i initially took mine out - only 2.3% and it has been between 1.3% APR and 3.2%APR up until this academic year. This year it has jumped up to 4.8% APR! I still owe the majority of my loan as I only appear to have paid the interest off in the last 4 years of work.
Anyone else suffering a similar loan burden?
Yes I get screwed every month by the studet loan, I payed ?154 last month:mad:. I working easter friday I can see about 33-40% of that being taken off me. I think the way I'm going it will be paid about 2012. By that time I will be a lot better per month once the dam thing is gone!
Tim in Belgium
07-02-08, 08:02 PM
If I ever get any spare cash it goes on getting the mortgage down, that always has a higher interest rate than my student loan.
And as for there being too many degrees, I agree to a degree ;)
Although I don't think all less than useful degrees are worthless, often they display a degree of thinking to enable an employer to judge whether someone is capable to do a job, e.g you can become an accountant or lawyer with just about any degree.
squirrel_hunter
07-02-08, 08:11 PM
My biggest beef with the loan is what has been echoed by many before, the interest rate. 4.8% for last year. We were told that it is a really small amount of interest and not to worry about it. And that is correct, if it were the CPI rate of 2.1%, but its not its linked to the RPI. Its just the government picking which rate suits them the best at the time.
Last year I paid £425 toward my loan. Of that £375 was interest. I only paid £55 off of the capital. I feel cheated. The idea of the interest is that you pay back 'in real terms' what you borrowed, but I don't think that is what is achieved with this type of interest.
Cant afford it, dont do it.
I didn't go to uni, I could have if I wanted to - had the grades and my folks had put the money aside for years to make it possible.
Why does EVERYONE in the country need to have a Degree anyway?
What use is a degree in Geology or French if you then end up in an Insurance Co (those are the degrees that a couple of the Management Trainees had in the branch I worked in)
I can see the point of Doctors, Dentists, Lawyers, Engineers, Chemical Scientists etc getting degrees but some of the Degrees out there just seem stupid.
I think that the proliferation of degrees is actually damaging the system, I remember when places like the Robert Gorden Institute of Technology in Aberdeen (RGIT) became Robert Gorden University (RGU) and could then convert the various vocational, and practical technical qualifications it handed out to being Degrees.
Now without putting down the qualifications, a Degree sounds better than a Dimploma (or Certificate) but there IS a difference in the two.
What we really need is the return of apprentiships so that people with talent can get a job and the training they need to do that job while not having to be forced down the route of Loans etc.
Agree with you totally soulkiss, alot of my friends have no intention of using what they're studying for when they're done. I think its a waste really, they're wasteing they're time and money on something they won't even use. As you say if you've gone to uni to get a degree and then manage to use that degree in your job then whats there to complain about, you got where you wanted. And your paying a small amount back towards it over the years.:roll:
Why all the winging ????
If you cant/couldnt afford it, shouldnt have done it.
Simple
err sorry David but I completely disagree with you here.. what you are saying is that education is for the rich only.. what a horrid thought so no one can work their way up in life.. not a nice thought at all.
This is exactly my position on it.
I went to uni as the jobs I wanted to do needs you to have a degree and qualification to even be recognised and to become chartered, without one you simply wont get a job.
My apologies if anyone does any subjects like Art or ClingOn Language, but I just dont see the point in it. I know 3 people who have done art degrees, they have £15k debt and no jobs so they just travel and claim they will never get a job.
It stupid degrees that are pointless and not required that have brought down the respect that a good degree deserves.
I also happen to agree with some of this although in fairness I dont think subjects in the Arts have brought down the system only the lowering of the standards required to get into them and the content of the courses.
Diversity is what makes the world go round.
Tim in Belgium
07-02-08, 08:24 PM
Engineers make the world go round, physicists decide the world is round and the arts lets us explain it without equations ;)
squirrel_hunter
07-02-08, 08:25 PM
Oh and what has also got my goat is that it has taken them 9 months to send my last years statement which prompted my to look into all of this. I have also tried to check their calculations but can't get my maths to match theirs. It doesn't help that they have structured the loan in such away payments, repayment, interest adjustments and so on are dotted all over the statement year.
For more information consult Student Loans Company (http://www.slc.co.uk/index.html) or Student Finance Direct (www.studentfinancedirect.co.uk) for the UK (but don't think about using the repayment calculator as it is currently unavailable, how professional and helpful).
suzsv650
07-02-08, 08:54 PM
all my friends in uni think that when they finish they will be paying £5 a week and that will pay it off.... reading this i think they are ALL quite wrong....
timwilky
07-02-08, 08:59 PM
Despite my attempts to help her, my daughter has finished up with debts in excess of £30,000. I worked out that during her studies I have given her over £10,000, for her accomodation
The majority of this debt is down to course fees whilst she did her masters then professional studies. she is somewhat lucky as she is about to be given £20,000 which should just leave her with just a student loan to repay. But I still don 't understand the funding of education.
The whole country benefits from an educated society. Yet we are in danger of restricting education to the most wealthy as only they can afford to support their children through it
timwilky... exactly
I worked all the way through my degree and still required help from the student loans and hardship funds available I dont see how it can be done otherwise now a days unless you have very wealthy parents who are willing to pay out.
If your education enables you to earn more and therefore pay more tax, then the repayment of the amount it cost in the first place means that you're paying twice for the same thing.
If your education enables you to earn more and therefore pay more tax, then the repayment of the amount it cost in the first place means that you're paying twice for the same thing.
Not if the tax you pay doesn't go on further education.
Not if the tax you pay doesn't go on further education.
What relevance is it how it's spent?
If you earn say £30K cos you had a loan-funded education, and you'd otherwise have been able to do a job that paid say £20K, and you have to repay the loan that enables that extra £10K, then the tax on the £10K is effectively a double repayment. I can't see it's relevant whether it's spent on higher education, health, or some quango. Fact is, you're paying twice.
What relevance is it how it's spent?
If you earn say £30K cos you had a loan-funded education, and you'd otherwise have been able to do a job that paid say £20K, and you have to repay the loan that enables that extra £10K, then the tax on the £10K is effectively a double repayment. I can't see it's relevant whether it's spent on higher education, health, or some quango. Fact is, you're paying twice.
I understand what you are saying but the tax isn't a repayment.
muffles
07-02-08, 09:24 PM
I had a new style student loan (I assume that means the ones that don't have set payments btw!). I just want to participate in this thread so I can whinge :D
I have paid it off btw, in the end it only took about 3 years which seems quite good (it was "only" £9k). I just want to moan:king:
I understand what you are saying but the tax isn't a repayment.
What else is it then? It's money that the government wouldn't otherwise have. There is no way they'd have it, cos it wouldn't exist inthe first place. So the successful student has created welath, and if they are repaying the reason for thatwealth eleswhere - to the Student Loans Company - then they must surely be paying twice.
I probably would have paid the loan off in bulk had I not saved and bought a house. My mortgage interest rate is now the same as my student loan. If i had any money spare (which I dont) then I would probably attempt to pay the student loan off because it will just be a "student tax" for the rest of my career at the rate of payment and the rate of interest.
timwilky
08-02-08, 12:12 AM
If your education enables you to earn more and therefore pay more tax, then the repayment of the amount it cost in the first place means that you're paying twice for the same thing.
Actually I agree with Ed on this. As I have previously said, the country benefits from an educated workforce. That sentiment was focused on what benefits in terms of end deliverable that workforce would generate. New products, systems, ways of working, wealth generated in selling out knowledge/products abroad etc.As in an end game.
I had totally missed what hits me hardest in the pocket. Tax. For the past 15-20 years I have paid the higher levels of tax. I started my working career as a 16 year old on an apprenticeship. If I had not had a strategy from day one that required me to prove myself, get my employer to sponsor me beyond the C&G that would have been the assembly line end point. I think that I would have been a product of 1980's rationalisation and an out of work waster.
Instead, I got £2,500 as a grant from HM government (self supporting, been working for 3 years) and £1,500 sponsorship from Leyland plus vacation employment. Real benefit to me was access to real labs, computers and facilities etc.
So for the £7,500 the government invested in me in the late 70s. I have repaid them with my never having made a benefit clain, paid tax at the higher rates for approx 20 years. and likely to be doing so for the next 20 years. I think they got more than a good deal out of me.
If I could give them a one off £7,500 and pay at 24% or whatever it would save me a fortune
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