'Students – lower earners deferring to 2012 could pay LESS' blog discussion

flimsier

Lokolo wrote: »

They have only made one change retrospectively since the loans began, and that is making the post 1998 threshold rise with inflation.

So why do you think they will change the terms so most loans are repaid?

This has nothing to do with FSP's and I assume you are one of these that is outraged by an increase of pension contributions for getting the best pension deal available in the UK.....

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As for "not knowing what you will earn after uni", well you can take a pretty good estimate by looking at graduate jobs in the places that they may want to work..... usually gives a pretty good idea.

I'm outraged that the amount I have paid into my pension is not going to deliver what I was told it was, yes.

As for the "you can take a pretty good estimate" - what are you talking about? We're talking about 17 year olds. A very very small proportion of people end up working at what they imagined they would do at 17. And few people actually earn the average (though if everyone did, it would make Martin's blog utterly wrong, obviously).

I thought I'd be a nurse or a firefighter when I was 17 (despite going to LSE to study Philosophy). I'm now a DHT, earning much more than I anticipated. If I was that 17 year old now, Martin would be advising me to get into more debt than I should.

Last, I think they'll change the criteria to raise more revenue. Of course they will - they're doing this to raise revenue/ reduce spending, and once the banks have burst, there's unlikely to be any going back. I'm not sure they'll do it retrospectively, but they certainly haven't guaranteed not to. Education isn't the preserve of the ruch, but I think it will be.

melancholly

flimsier wrote: »

If you consider the wage rises teachers get every year, they are very very likely to pay it off, and if not, certainly to pay off a very high proportion of it.

not really..... they'll have a bigger loan than average if they do the PGCE route (and i think a lot of BEd courses are 4 years as well, although some are 3). even with their wage rises each year, it's unlikely they'll pay it all back if you do the sums.

it's actually a good example of a career which is thought of as quite well paid (clearly not at the level of an investment banker!) with a fair amount of job security so teachers are unlikely to have significant periods out of work (although right now, getting teaching work in some subjects is harder than it has been for a long time). even these types of jobs won't pay off in full within the 30 year period before it gets cut off. this doesn't bode well for the government getting its sums right!

there's a chance of paying it off if they get a £6K a year fees loan but it's slim and probably would only be a couple of years early at most and that assumes going on to be a headteacher with a significant salary hike. the numbers don't really stack up that an average teacher will pay it off (although a high flyer who works in London so gets a higher salary might, just!).

i'm having my pension terms changed on me atm, so i'm highly distrustful of what tany government will do in the long term, but i just can't predict what they may do and when they may do it. you can only go by the facts as they are. i expect that fees will just continue to increase so that we reach a US model of HE, which i hate the idea of, but that's where we're heading. that will really screw over students in 10 years time, but i doubt they'd change the terms for existing graduates.

either way, i'd just like them to make the final terms clear before UCAS opens for applications for 2012...... how on earth people are expected to plan without knowing that yet is beyond me!

2sides2everystory

flimsier wrote: »

I'm sick of the political positioning that Martin has on this issue. He's supposed to chair an independent group, but he pretty much argues that the new system is better - and that's all he does. He's promoting young people getting into debt under the guise that this is "good debt".

Yes I too am very very uncomfortable with that.

Second, how the hell is a 17 year old going to know what they are going to earn (ie the article is completely useless because at 17 you have no concept of whether you'll be a low or a high earner) - in particular students who are thinking of going to university.

Yes, I was in the Head Office branch of a major UK bank this afternoon and got chatting with a cashier. A graduate naturally. Finance and Business Administration. Fast track training? No Sir. Can expect to be in that job at least 18 months. Salary including London weighting allowance? maybe £18K, maybe less I think. 16 year olds can do the same job, and he might know one or two who do. I have seen it. Why does a graduate in Finance and Business Admnistration have to start as only a bank cashier in today's upside down cake of a UK??

The amount most graduates will actually pay back is inconceivably high, and prohibitively so. The article is suggesting that they might be better off by delaying, but in fact the vast majority of students will be worse off by waiting, paying back a higher rate of interest over a longer period - and the article is promoting something that is (for the majority) wasting money rather than saving it.

Agreed.

JimmyTheWig

flimsier wrote: »

If you consider the wage rises teachers get every year, they are very very likely to pay it off, and if not, certainly to pay off a very high proportion of it.

That's what I thought. So I did the calculations myself.
See post #25:

JimmyTheWig wrote: »

I'm assuming a starting salary of £21k in todays money going up to a salary of £41k in todays money in 30 years in equal jumps (giving the average of £31k in todays money).
I'm assuming wage inflation of 4%.
...
With the new scheme a debt of £75k (£26k in todays money) will be wiped off in 30 years, with the student having paid £49k in todays money over that time.

But, despite earning an impressive sounding £162k in 2046, the level of fees they are charged to study in 2012 is irrelevant.