Should I Pay Off My Student Loan? 2008/09 article discussion

Oldernotwiser

jgn_1982 wrote: »

Well I dont think its right that the loan increases post uni for students who earn above £15k but dont earn enough to cover the interest so you are paying each month but the total owed increases.
For instance someone who was to earn 19k for their life - perhaps they do some kind of voluntary work that gives them greater satisfaction than chasing money - would pay £800 a year and but by the time they retire the 12k debt is probably over 30k


.

In your example, the person in question would be paying back £30 per month, which is hardly onerous and then, when they retired, the loan would be wiped off. This doesn't seem to me to be a bad exchange for a university education!

Oldernotwiser

jgn_1982 wrote: »

For one thing a good starting point will be a better level of communication between the students - I feel lead up the garden path with regards to my loan but then I guess it was my responsibility in the first place to look more into it so i am partly to blame.

I can't see what more can be done than giving people details of the conditions and expecting them to read and understand it.

If you had understood the conditions properly, how would you have behaved differently?

jgn_1982

Probably not post on here ty

Oldernotwiser

jgn_1982 wrote: »

Probably not post on here ty

Mine was a serious question and not a dig! Are you saying that you wouldn't have gone to university or that you could have managed without taking out the loan? Otherwise you're no worst off than if you'd understood the conditions.

worriedandbroke

Hi, I wonder whether anyone can help me with a couple of questions? I am due to return to Uni in a couple of weeks and will be entering my third year of study. I currently have £8000 of student debt. I have used this money to pay off previous financial commitments (such as credit cards) and have also put some in a savings account. Have I done the right thing in taking out a loan and using it in this way or would I have been better to not take out a student loan at all?

Also, my husband and I have put our home up for sale and will need a new mortgage when we move. Does my student loan enter the equation for how much we can borrow, even though I do not have to start paying it back until I finish my studies?

Oldernotwiser

worriedandbroke wrote: »

Hi, I wonder whether anyone can help me with a couple of questions? I am due to return to Uni in a couple of weeks and will be entering my third year of study. I currently have £8000 of student debt. I have used this money to pay off previous financial commitments (such as credit cards) and have also put some in a savings account. Have I done the right thing in taking out a loan and using it in this way or would I have been better to not take out a student loan at all?

Also, my husband and I have put our home up for sale and will need a new mortgage when we move. Does my student loan enter the equation for how much we can borrow, even though I do not have to start paying it back until I finish my studies?

Most advice would agree that you've done the right thing byusing your student loan in the way that you have done. The interest rate is lower and the repayment terms are far more flexible.

Most lenders won't take your student loan repayments into consideration when looking for a mortgage because there's no way of telling what they'll be until you leave and get a job.

trojjer

It is a bit daunting, but I've got it into my head that it's just a "graduate tax" now. I'm starting this September with a total of £5571 at 3.8% (which I just found out was the new rate for 08/09 -- it dropped one whole percent, hmm), and I'm probably going to put anything that I don't need immediately into savings. The non-repayable grants and bursaries help on top of the loans of course; I keep to keep telling myself that it may be the most money that I've ever seen, but relatively speaking a total of £6571 a year isn't all that much when compared to a part time job. But I'm not complaining.

Mind you, knowing that the interest at the end of my first year of study will be about £211.70 (according to my spreadsheet calculations) is a little daunting... But at least I know what to expect.

surfsister

trojjer wrote: »

It is a bit daunting, but I've got it into my head that it's just a "graduate tax" now. I'm starting this September with a total of £5571 at 3.8% (which I just found out was the new rate for 08/09 -- it dropped one whole percent, hmm), and I'm probably going to put anything that I don't need immediately into savings. The non-repayable grants and bursaries help on top of the loans of course; I keep to keep telling myself that it may be the most money that I've ever seen, but relatively speaking a total of £6571 a year isn't all that much when compared to a part time job. But I'm not complaining.

Mind you, knowing that the interest at the end of my first year of study will be about £211.70 (according to my spreadsheet calculations) is a little daunting... But at least I know what to expect.

Your spreadshet sounds helpful!

Spectralis

Well, I'm considering going back to uni and over the next 4 years will be borrowing £3,500 a year to pay uni fees and £6,500 for living costs. That's going to leave me at least £40,000 in debt by the end of it.
I object a great deal to paying for education which is basically training for work. Employers benefit from this training and contribute nothing towards improving the skills of the UK's labour force. Students are paying for it. It also discriminates against students who come from families on low incomes who are placed in much greater debt.
It's argued that students benefit through the potential of an increased income but this is not guaranteed. Especially in this climate of privatisation and attacks on wages.
Almost all leading members of the government who forced loans on students have benefited from free education at the tax payers expense.
After having paid taxes for years I object to now paying for "education" (job training) while billions are spent on war and the olympics that the majority of the population don't even want nor benefit from.
So, I don't agree that student loans are a good deal for students. They are a form of individual taxation for improving the skills of the labour force which benefit employers ultimately. I would be in full support of a campaign against loans in protest at this unfair taxation if ever one develops. I hope it does.

Chris2685

We already have loads of people going to uni 'just for the experience' who really don't want to work, because mummy and daddy are paying for it, or they just don't care about the debt. If it was free, i'm pretty sure there would be even more wasters doing it!