'Don't pay your kids tuition fees upfront' Discussion Area

kayr_2

The_One_Who wrote: »

I think if the parents have managed to save the £30,000 for their child's tuition fees, then they've been at it for a while. Most people I know don't have a spare £30k lying around with no ultimate purpose. And if it was me in that situation then I'd ask them to keep it for until I graduate. So it wouldn't be a choice of "take the £30k for your fees or you don't get anything".

The bit that would make me more inclined to pay the fees upfront is the fact that the 2012 loan will be growing, taking today's figures, at around 8% rather than the 1.5% for students who have just started now. I really don't like that idea - inflation may calm down and interest rates rise but then again it might not so if you go into a high earning profession, well you may be in Martin's scenario 3. It might be better to pay for fees rather than help with a house deposit. Still got at least 18 months to think about this!!

The_One_Who

kayr wrote: »

The bit that would make me more inclined to pay the fees upfront is the fact that the 2012 loan will be growing, taking today's figures, at around 8% rather than the 1.5% for students who have just started now. I really don't like that idea - inflation may calm down and interest rates rise but then again it might not so if you go into a high earning profession, well you may be in Martin's scenario 3. It might be better to pay for fees rather than help with a house deposit. Still got at least 18 months to think about this!!

Like I said, it will depend on each family's own personal circumstance, I don't really believe that there is a one-size-fits-all solution for this. Different people will find different things work for them. It needs to be a discussion between the parents and the student as to what will work best for them.

setmefree2

The_One_Who wrote: »

Because life is complicated, especially when it comes to balancing the books of the government. It'd be lovely if they could pour money into everything, but they can't. Something needs to give. And in this case higher education has taken a hit. If it was HE it'd be something else.

HE shouldn't be financed like this. If they tried to charge people for accessing health care at the point of use nobody would accept that. Nor primary or high school education. Why people think it's ok to charge for HE at point of use is beyond me. It's created a massive bureacracy with the SLC, it's totally inequitable, stupidly complicated and is a massive waste of everyone's time. Of course, imho.

Governments' waste tons of tax payers money. I'm sure there is a better way to fund HE out of general taxation. People have just gotta want it.

Look at the mess governments created with the Child Support Agency. The only rational thing to do in the end was scrap it. One day it was there, one day it was gone. Does anyone miss it?

melancholly

kayr wrote: »

The bit that would make me more inclined to pay the fees upfront is the fact that the 2012 loan will be growing, taking today's figures, at around 8% rather than the 1.5% for students who have just started now. I really don't like that idea - inflation may calm down and interest rates rise but then again it might not so if you go into a high earning profession, well you may be in Martin's scenario 3. It might be better to pay for fees rather than help with a house deposit. Still got at least 18 months to think about this!!

my perspective is that since you can't plan for every outcome, then it's best to go with the safest option. it's also about what proportion of savings this is for parents - there is no point parents putting all their savings into paying for university. five years down the line, financial circumstances can massively change (the last few years have made that pretty clear!) and if parents remove their buffer, it's risky. granted if they have enough for a uni education (fees plus living expenses at £45K all in) plus plenty more in savings, that's different - but equally, quite rare!

there are also plenty of parents who may be able to help, at least in part, but instead expect the students to pay for it themselves through loans. plus students who wouldn't want to take that much money from their parents. taking the money can set up a difficult dynamic, a bit like when parents pay their child's wedding. this will depend on the parents and the child - sometimes it all works like a dream whereas other times, parents and children view the boundaries in different places....

there is no perfect one-size fits all solution and it as much depends on the personalities involved as the pure financial facts - which is why i think it's important for the 'don't take the loans, they're awful' line to be moderated by other opinions.

you'll at least have more time to think about this with the full facts because by the time your child is off, they should hopefully have announced the early repayment situation. then you'll have the full facts. it is also worth thinking about interest rates over the life of the loan - the initial extra percentage is indeed quite a cynical move, but this loan really has to be considered over the whole term. (plus factor in things like career breaks - unplanned redundancies or planned gaps, maybe for kids, or as quite a few 'higher earners' seem to be doing - a sabbatical/'gap year on a proper budget').

setmefree2

Oldernotwiser wrote: »

I think it's all very well to suggest that HE should be funded out of general taxation but the cynic in me smiles when that suggestion's made by an accountant whose profession will be making damned sure that its wealthy clients will be making use of every loophole going to avoid paying any extra taxes.

I pay plenty of tax and so do most of my colleagues. I'm sure we've given back more to the British Economy than we've ever taken, so I think your comments are unfair.

melancholly

setmefree2 wrote: »

It definitely wasn't me (well I don't think ) and I accept you're apology. However, if indeed you did ask me before and I didn't respond then I apologise to you.

and i know i should be above this, but if you're going to throw insults about posting with capital letters, get your own grammar in order first. it's a low blow on forums anyway to mock for spelling and gammar, but if you're going to do it, make sure you never make any errors yourself!

setmefree2

Oldernotwiser wrote: »

And, if it were me, I'd have too much pride to take money that they'd scrimped and scraped to save.

And you know what they say about pride don't you - it come before a fall.

The_One_Who

setmefree2 wrote: »

HE shouldn't be financed like this. If they tried to charge people for accessing health care at the point of use nobody would accept that. Nor primary or high school education. Why people think it's ok to charge for HE at point of use is beyond me. It's created a massive bureacracy with the SLC, it's totally inequitable, stupidly complicated and is a massive waste of everyone's time. Of course, imho.

Why should higher education be free for all? It is not part of the compulsory education system, nor is it universally accessible like the health care system. It is not a basic right.

I think we both agree that higher education should be restricted to those who are academically capable, but at the moment we need to work within the system we have.

I would have been more than happy to pay for my university education, but then I (unlike most students) have an understanding as to how much it really cost. I was lucky that I didn't need to pay fees, but I would if I had to.

setmefree2

kayr wrote: »

The bit that would make me more inclined to pay the fees upfront is the fact that the 2012 loan will be growing, taking today's figures, at around 8% rather than the 1.5% for students who have just started now. I really don't like that idea - inflation may calm down and interest rates rise but then again it might not so if you go into a high earning profession, well you may be in Martin's scenario 3. It might be better to pay for fees rather than help with a house deposit. Still got at least 18 months to think about this!!

Yes I feel like this too and I don't feel like a high inflation scenario has been fully addressed anywhere. It may be that the impact of the January VAT rise, the recent falls in commodity prices and the pressure on retailers of falling sales might mean we see a better RPI figure come Marh 2012. But the BOE doesn't fill me with confidence (since the quickest way out of a debt crisis is high inflation).

setmefree2

melancholly wrote: »

there are also plenty of parents who may be able to help, at least in part, but instead expect the students to pay for it themselves through loans.

I know you have criticized me for this but this is another aspect of the SL system I don't like. If you want to help your kids it's an all or nothing scenario. It's £45k or don't bother. I really really don't like that aspect.