Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • Former MSE Wendy
    • By Former MSE Wendy 9th Jun 11, 3:39 PM
    • 868Posts
    • 1,782Thanks
    Former MSE Wendy
    Student Loan 2015 Discussion
    • #1
    • 9th Jun 11, 3:39 PM
    Student Loan 2015 Discussion 9th Jun 11 at 3:39 PM
    This is the discussion area for the




    Please let us know what you think below.
    Last edited by Former MSE Wendy; 21-10-2015 at 11:52 AM.
Page 45
    • koru
    • By koru 22nd Mar 16, 4:25 PM
    • 1,277 Posts
    • 646 Thanks
    koru
    My son just started Uni with 3 year course normal 9K a year fees and 4k a year maintenance loan. His grandparents are giving him 6k a year over next 3 yrs, should he pay part of his loan off or keep loan and repay when earning but use the 18k over 3 years to save eg in new Help to Buy ISA released end of this year? Any guidance appreciated
    Originally posted by Beagles4ever
    I know this is from last year, so it might be too late for Beagles4ever, but for the benefit of anyone else reading this thread with a similar query, I would say there's a very good chance that the son would be better off if he takes the maximum loan and saves any excess cash. It is all explained in this article (which, if anything, understates the case):
    http://www.moneysavingexpert.com/students/should-i-get-student-loan

    Unless he is a VERY high earner throughout his career, the loan is likely to end up costing him the same, whether he takes the maximum loan or not. So, better to keep the cash.

    Even if he is a very high earner, the extra repayments he makes as a result of having a bigger loan are still likely to be less than the benefit he gets from hanging on to the cash. He can probably invest it and earn a higher return and he can use the accumulated amount as a house deposit. Plus in a year's time he can get £1000 per year free from the govt in a Lifetime ISA.
    koru
    • nemo183
    • By nemo183 28th Apr 16, 5:33 PM
    • 615 Posts
    • 266 Thanks
    nemo183
    Official Stats on jobs that require degrees.
    Government figures say that 25% of jobs in the UK require a degree, yet 50% of people leaving the education system have a degree. Go figure.....
    Last edited by nemo183; 28-04-2016 at 5:33 PM. Reason: spelling
    • Sunny1966
    • By Sunny1966 20th Sep 16, 10:58 AM
    • 1 Posts
    • 0 Thanks
    Sunny1966
    Sunny1966
    Hi Martin
    My son has started Uni this week (Sept 2016). His accommodation fell through, and he will continue to live at home if a suitable alternative cannot be found. If he lives at home, I see we are supposed to top up his maintenance loan to the maximum amount. If we do, is he then expected to make a contribution back to us for living expenses such as rental, food etc.

    I feel that if this is not expected, it is a lot of money that would probably be wasted on entertainment and non-essentials and would not be teaching him any life skills or how to budget.

    I would be grateful for some guidance. Thanks
    • Mamofsix
    • By Mamofsix 26th Sep 16, 8:11 PM
    • 1 Posts
    • 0 Thanks
    Mamofsix
    Interest is charged from the day you first get your loan so even if you were able to get a billion pound job as soon as you left uni you would still have to pay some interest.
    Also the HMRC hangs on to your payments until the end of the tax year before paying it to Student Loans so more interest is accumulated.
    • missbiggles1
    • By missbiggles1 26th Sep 16, 8:16 PM
    • 16,396 Posts
    • 30,258 Thanks
    missbiggles1
    Hi Martin
    My son has started Uni this week (Sept 2016). His accommodation fell through, and he will continue to live at home if a suitable alternative cannot be found. If he lives at home, I see we are supposed to top up his maintenance loan to the maximum amount. If we do, is he then expected to make a contribution back to us for living expenses such as rental, food etc.

    I feel that if this is not expected, it is a lot of money that would probably be wasted on entertainment and non-essentials and would not be teaching him any life skills or how to budget.

    I would be grateful for some guidance. Thanks
    Originally posted by Sunny1966
    The living at home rate is considerably less than the rate for living away.
    • Ed-1
    • By Ed-1 26th Sep 16, 9:48 PM
    • 2,043 Posts
    • 1,102 Thanks
    Ed-1
    Also the HMRC hangs on to your payments until the end of the tax year before paying it to Student Loans so more interest is accumulated.
    Originally posted by Mamofsix
    Wrong. Interest is frozen on your account at the start of every tax year until your income and repayment amount is known after the end of the tax year. Any repayment is then applied as if it was received on the last day of each calendar month in the tax year and for plan 2 loans, the income figure determines what rate of interest is applied.
    • kzap
    • By kzap 27th Sep 16, 11:15 PM
    • 2 Posts
    • 1 Thanks
    kzap
    As I understand it parents residual income is calculated before tax. This penalises families with one high earner rather than two lower earners. One person earning £57k has the same income after tax as two on £25 k each. The single high earner has already lost child benefit given to the two earner family. This calculation should be made using income after tax.
    • kzap
    • By kzap 27th Sep 16, 11:20 PM
    • 2 Posts
    • 1 Thanks
    kzap
    It looks to me that students living at home actually get a very good deal- they receive only £1296 a year less than those living away from home. There is no way a student living away from home could pay rent, utility bills and eat breakfast for that! Travel costs may need to be met- but students living away from home also need to pay for some travel.
    This amount must include a contribution to living costs at home.
    • Mrs Arcanum
    • By Mrs Arcanum 27th Sep 16, 11:22 PM
    • 15,844 Posts
    • 32,110 Thanks
    Mrs Arcanum
    As I understand it parents residual income is calculated before tax. This penalises families with one high earner rather than two lower earners. One person earning £57k has the same income after tax as two on £25 k each. The single high earner has already lost child benefit given to the two earner family. This calculation should be made using income after tax.
    Originally posted by kzap
    The other difficulty is cost of living. No allowance is made for higher housing costs when calculating what student loans are given.
    “We put all our politicians in prison as soon as they’re elected. Don’t you?” “Why?” “It saves time.” ― Terry Pratchett, The Last Continent.
    • klint
    • By klint 29th Mar 17, 9:01 PM
    • 259 Posts
    • 88 Thanks
    klint
    Can someone explain what the Student Finance Government website means in the section titled "What income is assessed" concerning the tax year for which the household income is assessed.

    Up to now, my son has been entitled to a full student loan because I've been living away from home, so my income wasn't taken into account when assessing household income.

    For the academic year 2017-18, the household income assessed is for tax year 2015-16. I am going back to living as part of the household this April. Now when my son goes back to university in September, will the household income include my income? I wasn't at home in 2015-16, so does that mean my income is not included?
    • stomalomalus
    • By stomalomalus 18th Apr 17, 11:28 AM
    • 1 Posts
    • 0 Thanks
    stomalomalus
    Student Loan Overseas Thresholds
    I live in Hungary, and am vexed by the overseas thresholds.

    The threshold for Hungary was decreased to just over 7,000 pounds a year before tax last year.

    This amount is a crazy low sum. I currently earn around 18,000-19,000/year before tax, and I earn a pretty good wage for Hungary.

    I am demanded to make repayments of 95 pounds a month towards my student loan. Previously, the threshold was around 9,500 a year. According to the cost of living, that's a fair amount, and would result in me paying back around 60 pound per month. That 50% increase is huge, when I'm no better off tha before.

    Is there anything I can do? Or any way to make a real complaint?
    • silvercar
    • By silvercar 18th Apr 17, 12:46 PM
    • 36,201 Posts
    • 152,996 Thanks
    silvercar
    I live in Hungary, and am vexed by the overseas thresholds.

    The threshold for Hungary was decreased to just over 7,000 pounds a year before tax last year.

    This amount is a crazy low sum. I currently earn around 18,000-19,000/year before tax, and I earn a pretty good wage for Hungary.

    I am demanded to make repayments of 95 pounds a month towards my student loan. Previously, the threshold was around 9,500 a year. According to the cost of living, that's a fair amount, and would result in me paying back around 60 pound per month. That 50% increase is huge, when I'm no better off tha before.

    Is there anything I can do? Or any way to make a real complaint?
    Originally posted by stomalomalus
    At £18,500 with a £9,500 threshold you would be paying £67.50 per month.

    At £18,500 with a £7,000 threshold you would be paying £86.25 per month.

    So the increase is less than 28%.
    • Scarloc99
    • By Scarloc99 19th May 17, 12:27 AM
    • 5 Posts
    • 1 Thanks
    Scarloc99
    Government figures say that 25% of jobs in the UK require a degree, yet 50% of people leaving the education system have a degree. Go figure.....
    Originally posted by nemo183
    Realise this post is from a while back but i see quotes like this alot.

    lets say there are 1000 jobs in the UK 25% of them is 250 so 250 jobs

    Now lets say there are 500 people in the education system, 50% is 250 so the right number of people for the jobs required.

    The 2 numbers are completely independent of each other, 50% could be more (if 1000 people left education) or it could be less. The important thing is understanding that they have no relation to each other and so cant be compared. If a whole number was used, for instance the government says there are 20,000 university level jobs but 40,000 university leavers then a discussion can be had.
    • Scarloc99
    • By Scarloc99 19th May 17, 12:37 AM
    • 5 Posts
    • 1 Thanks
    Scarloc99
    The living at home rate is considerably less than the rate for living away.
    Originally posted by missbiggles1
    The parents contribution should always be taken as a guide and not a requirement in my experience. I went away to University to study and my sister stayed at home. My parents supprted me by directly paying towards my rent, the amount they paid worked out as less then the amount suggested by the guidlines, I had a partime job. Mum and Dad where there for emergencies if needed but certainly they didnt just give me a lump sum to mae up there contribution.

    My sister, by living at home continued as normal, food etc all paid for, again they didn't pay her a top up out of there money and in fact she paid them a monthly rent amount (they actually saved it away and she had it to put towards a car when she graduated) this helped teach her the same lesson I was learning living away about budgeting etc. We where treated equally but she got more in terms of 20 here and there for socialising and going out. I got the larger lump sum payments towards rent, or a big food shop.

    Up to you how you manage it but I would advise you see how your son is managing before handing over lump sums of cash.
    • GoodIntentions
    • By GoodIntentions 14th Jun 17, 3:19 PM
    • 11 Posts
    • 1 Thanks
    GoodIntentions
    Paying back too much?
    Hi all,

    My sister lives in Australia and is paying off her student loan from there. She told me that she is paying back $250AUD per month and I thought this seemed very high. Hoping someone can provide some insight into this and if you think this is high. Here are the details of her loan, if you need further information let me know.

    Balance £15,733.16

    Interest Rate: 1.25%

    Arrears: £2,015.00

    Monthly repayments: £150.00

    Thanks in advance

    GI
    • sheramber
    • By sheramber 14th Jun 17, 3:51 PM
    • 3,974 Posts
    • 2,955 Thanks
    sheramber
    Hi all,

    My sister lives in Australia and is paying off her student loan from there. She told me that she is paying back $250AUD per month and I thought this seemed very high. Hoping someone can provide some insight into this and if you think this is high. Here are the details of her loan, if you need further information let me know.

    Balance £15,733.16

    Interest Rate: 1.25%

    Arrears: £2,015.00

    Monthly repayments: £150.00

    Thanks in advance

    GI
    Originally posted by GoodIntentions
    according to this
    http://www.studentloanrepayment.co.uk/portal/page_pageid=93,6678668&_dad=portal&_schema=PORTAL

    She is due to pay 9% of her income over £21330
    • koru
    • By koru 14th Jun 17, 8:16 PM
    • 1,277 Posts
    • 646 Thanks
    koru
    That link does not work. Try
    http://www.studentloanrepayment.co.uk/portal/page?_pageid=93,6678668&_dad=portal&_schema=PORTAL
    koru
    • jrallen17
    • By jrallen17 20th Aug 17, 7:21 PM
    • 1 Posts
    • 0 Thanks
    jrallen17
    if I repay the loan straightaway, won't I still have a hefty % interest charge ?
    Hi

    so if I complete a 3 years course, say with a student loan each made up of £9000 fees and £4000 maintenance, so £13,000 x 3 = £39,000 after 3 years, then let's say I was in a position to pay that back in full after the 3 years [or maybe 1 year later], Martin's guide says

    "While studying:

    Accrues RPI inflation plus 3% on the outstanding balance. This continues until the first April after graduation when it changes to…"

    IF inflation is 3%, then we are looking at 6% total,
    SO surely my first year's £13k has become £13,780 with interest,
    then at end of year 2 I might have that £13,780 + £13k more loan, plus another year's interest on the lot, so then I start year 3 with £28,387.
    Add year 3's £13k loan, and end of year 3 with 12 more month's interest = grand total £43,870.

    Hence I've borrowed 3 lots of £13k = £39k. If I finish and straightaway enjoy a lottery win, then I've clocked up a massive £4,870 of interest in just 3 years.
    So before I have any earned income, this penalty is there if I want to clear the debt, so if I had had the £50k lottery win just before I started uni., surely I'd have been better off funding my own needs for 3 x £13k, rather than borrowing 3 lots of £13k on the student loan ? OR am I missing something ?

    Martin Lewis, PLEASE advise / enlighten ! [I ask because I heard you on 5Live about this last Monday, read your 6,000 words - super job - and this is my ONLY query after all of that].
    • silvercar
    • By silvercar 20th Aug 17, 10:38 PM
    • 36,201 Posts
    • 152,996 Thanks
    silvercar
    Hi

    so if I complete a 3 years course, say with a student loan each made up of £9000 fees and £4000 maintenance, so £13,000 x 3 = £39,000 after 3 years, then let's say I was in a position to pay that back in full after the 3 years [or maybe 1 year later], Martin's guide says

    "While studying:

    Accrues RPI inflation plus 3% on the outstanding balance. This continues until the first April after graduation when it changes to…"

    IF inflation is 3%, then we are looking at 6% total,
    SO surely my first year's £13k has become £13,780 with interest,
    then at end of year 2 I might have that £13,780 + £13k more loan, plus another year's interest on the lot, so then I start year 3 with £28,387.
    Add year 3's £13k loan, and end of year 3 with 12 more month's interest = grand total £43,870.

    Hence I've borrowed 3 lots of £13k = £39k. If I finish and straightaway enjoy a lottery win, then I've clocked up a massive £4,870 of interest in just 3 years.
    So before I have any earned income, this penalty is there if I want to clear the debt, so if I had had the £50k lottery win just before I started uni., surely I'd have been better off funding my own needs for 3 x £13k, rather than borrowing 3 lots of £13k on the student loan ? OR am I missing something ?

    Martin Lewis, PLEASE advise / enlighten ! [I ask because I heard you on 5Live about this last Monday, read your 6,000 words - super job - and this is my ONLY query after all of that].
    Originally posted by jrallen17
    Well Martin's advice is you shouldn't pay it off unless you are confident of being a high earner for a long time. So it isn't an either/or between not taking it and repaying on graduating.

    If that is genuinely your only considerations, I would say you also could consider taking the loan and investing it if you don't need to live off it. could you gain more interest than you are charged?

    The other point worth making is that most universities will charge you the full year's tuition fees at the beginning of each academic year unless you are taking the tuition fee loan when they accept phased payments through the year (so interest only charged from when each phase is given). It would be worth calculating the interest on paying the loan off as it is given to you as that would be potentially cheaper than paying the tuition fees yourself.

    The other point is that it may be worth waiting until you have finished studying before paying it off just because if something went wrong during your studies and you dropped out, the forecast of a high earner may change.
    • koru
    • By koru 21st Aug 17, 9:05 AM
    • 1,277 Posts
    • 646 Thanks
    koru
    guide to likely future salaries
    Martin has explained that you are only going to end up repaying in full if you get big salary increases. To get an idea of what is likely, the following Economist data shows the average salary, 5 years after graduation, for most subjects:
    https://www.economist.com/blogs/graphicdetail/2017/08/graduate-earnings

    You can also look at this split down for each university, by subject. (It might help in choosing subjects/uni, although earnings aren't the only criterion, of course.)
    koru
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

3,564Posts Today

7,857Users online

Martin's Twitter