'Getting boos from 16,000 people about student loans…' blog discussion

jamesd

oakhouse13 wrote: »

It's about the lifestyle moneysavingexpert advertises which is a consumer lifestyle requiring credit cards and shopping. Neither of these is necessary for students in my view.

I'm not sure you've really read his message very thoroughly. Try taking a look at the best 0% credit cards article. Before it even gets to the cards it's said:

• Do it right and credit cards are the cheapest way to borrow, you can get 0% for up to 15 months, yet get it wrong and you'll be stuck in debt for years.
• all borrowing is tinged with the dark side, lose your income and debt will leave you in a nightmare
• Don’t use cards to supplement day-to-day spending.
• To correctly use a credit card, ensure all borrowing is planned, budgeted for and as cheap as possible. If you’re just grabbing it to ease the strain on your pocket, that's a mammoth danger signal, please read the Debt Problems guide before getting yourself into trouble.
• Debt is like fire, used well it’s a great tool, used badly you’ll get burned.

That selection of cautions and links to alternatives and better choices is pretty thorough compared to a place that has solely selling as its focus and I think it illustrates Martin's be sensible approach well.

oakhouse13 wrote: »

"Neither Martin nor any other credit broker is authorised or able to broker student loans." Will that always be the case? I think I have read that loans will be run on a commercial basis in the future.

We'll see. Not so far as I know today, but that could change. If it does there will be time to consider how Martin handles it then.

oakhouse13 wrote: »

"pitching loans for students that were not the best in the market" I think you put too much faith in what referral business on commission such as consumer websites can do. If anything, commission has a history of leading to the wrong products being sold, is my understanding.

Since we're discussing Martin and this site I look at how he handles himself and things here. So far I'm content with the approaches used. He could change in the future. If he does my opinion might change. We'll see.

One thing he does clearly know very well is that his ability to get a message out - and sell - depends on his audience trusting him. So he has very strong financial as well as personal incentives to take great care with how he acts. Like all other people who are celebrities he's also subject to lots of muck-raking and adverse press comment potential if he ever gets things seriously wrong.

It's also worth remembering that he's simply another person, basically no different from you or I. He gets to make mistakes while trying to do what's right, just like the rest of us. There's a need to treat him as another person - in a civil way, and knowing it's a real person potentially being hurt - even while disagreeing with him sometimes.

oakhouse13

We read things differently but my view is the purpose is to sell a credit card and this is the sales patter in the same way in a market someone might shout insults about what they're selling. It's all sales in my view because if the credit card company was not offering the incentive of £10 to refer a sale it would not be a business.

My view is that the volume of credit cards taken out over the years introduced by Martin Lewis has not overall been beneficial to the public which is very much in debt but it has been financially very profitable for him. This is my gut feel, I can't prove it and if I am wrong I apologise. I don't agree with promoting a shopping voucher for £30 if you take out a credit card, for example, as moneysavingexpert does. The people for whom a £30 shopping voucher matters should not be taking on the risk of debt but just saving and when they have £30, going shopping if that is what they want to do with their lives.

The balance transfer card advertised this week - it is so opaque and the full story is not being told, cannot be told intentionally in my view.

I am concerned instinctively about what he is telling young people about university and debt. I don't always trust numbers to be honest, they can be very deceptive.

oakhouse13

"It's also worth remembering that he's simply another person, basically no different from you or I. He gets to make mistakes while trying to do what's right, just like the rest of us. There's a need to treat him as another person - in a civil way, and knowing it's a real person potentially being hurt - even while disagreeing with him sometimes."

Agreed and he gives us this platform to say what we think. If what we say has any merit it is his publishing it that enables us to take part in the discussion. I am instinctively anti sales. People are exposed to far too many sales messages and for many they have not calculated risk and their lives are seriously out of balance for what? If sales messages had not reached them in the first place, this would be less of a problem in my view.

Lokolo

oakhouse13 wrote: »

I am concerned instinctively about what he is telling young people about university and debt. I don't always trust numbers to be honest, they can be very deceptive.

Then why not work it out yourself?

The fact is this debt is completely different to one of a credit card, overdraft, loan or mortgage and that's what needed to get across. Just because you will be £100k in debt, doesn't mean you will re pay that £100k. No-one should be bothering to look at the amount of debt there is, but instead look at the repayments over a 30 year period.

The repayments are pretty minimal, even on my income where I will be paying a lot of student loan back each month and with a lower threshold, it's not effecting me at all, I will still get a mortgage, still making pension contributions and I still have money left over.

oakhouse13

"Then why not work it out yourself?"

Because there are three or four hundred views of what I have to say. I am not advertising to influence millions and gaining from signing up young people to a commercial, money making email.

Lokolo

oakhouse13 wrote: »

"Then why not work it out yourself?"

Because there are three or four hundred views of what I have to say. I am not advertising to influence millions and gaining from signing up young people to a commercial, money making email.

And neither is Martin, Student Loans are not a commercial debt, and aren't anything that Martin Lewis can benefit from.

I for one have been on this forum for years, learning about student finance, even taking it myself. Yet I have never clicked on a link on this website which leads me to any financial product.

Students aren't exactly massive around here, even in the student forum there is only maybe 1 or 2 regulars who are now students, the rest are older generation and a few ex students, and someone that used to work for his local LEA working on student finance.

oakhouse13

So it's more of a disaster then.

"Student Loans are not a commercial debt, and aren't anything that Martin Lewis can benefit from."

What is happening to the Student Loans Company? I thought I had read that loans would be commercially offered. I'm not saying that is a good or bad thing. Are you saying there's no change?

Lokolo

oakhouse13 wrote: »

So it's more of a disaster then.

"Student Loans are not a commercial debt, and aren't anything that Martin Lewis can benefit from."

What is happening to the Student Loans Company? I thought I had read that loans would be commercially offered. I'm not saying that is a good or bad thing. Are you saying there's no change?

How exactly?

And that was one rumour? Which has been going around for a week, hardly something to take seriously.

And no I am not saying there is no change, I am saying there is very little change given the outburst of people who think this is a huge debt which students will have to pay back - which they might not.

oakhouse13

http://www.guardian.co.uk/education/2011/jun/25/banks-university-funding-private-loans

Lokolo

oakhouse13 wrote: »

http://www.guardian.co.uk/education/2011/jun/25/banks-university-funding-private-loans

Bit longer than week then

It still doesn't mean a thing until its implemented. ML has been doing this student finance stuff for months now, theres already been an ongoing discussion in the student forum about it. ML did the same stuff for the old student loans which isn't commercialised.

The fact is, currently, it's not a commercial debt (and I doubt it ever will be), ML isn't there to make money out of it, hes trying to get students to understand it, he has a whole big project on "Financial Education for Kids" as thats what its all about.

With the number of parents coming on the student boards saying "OMG I'm going to remortgage my house by £60k to pay for it" just shows the lack of understanding of student loans and thats why he is doing it.