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

amiehall

Well tbh I'm not sure I would trust them to raise the threshold. The last threshold hasn't been raised even through several years of 5% inflation. Clearly it's not written into the t&c that they must raise the threshold so why would you trust them to do it particularly when they haven't bothered to in the past.

tyllwyd

amiehall wrote: »

Well tbh I'm not sure I would trust them to raise the threshold. The last threshold hasn't been raised even through several years of 5% inflation. Clearly it's not written into the t&c that they must raise the threshold so why would you trust them to do it particularly when they haven't bothered to in the past.

My understanding is that reviewing the threshold annually (from 2016) is something that they committed to doing when they were setting up the new system, and that they also said they would be reviewing the thresholds on the current loans. But it isn't a guarantee to raise the threshold, and obviously keeping it the same for a period of time would be an easy way to raise more money over the life of the loan. But that's part of the picture if you take out a loan, not much that can be done about it - in the same way, we trust the government to raise the thresholds for income tax and national insurance every year, but they are happy to fiddle with them when it suits them.

Lokolo

amiehall wrote: »

Well tbh I'm not sure I would trust them to raise the threshold. The last threshold hasn't been raised even through several years of 5% inflation. Clearly it's not written into the t&c that they must raise the threshold so why would you trust them to do it particularly when they haven't bothered to in the past.

The rising of the threshold is new, hence why it hasn't happened before, not that you can't trust them as they haven't done it before. It's new.

Like ISA allowance rising by inflation, which is also new.

MrsAverage

Does anyone know what happens to the thresholds and repayment rates if a student ends up living and working abroad?

I know they are likely to be chased for repayments even if emigrated - but what if that country has a much lower, or higher, average annual salary?

Oldernotwiser

tyllwyd wrote: »

I'm inclined to agree - unless you go into the field that you study, for a lot of people the fact that you are a graduate is more important than the university you studied at by the time you are a few years into your career.

I don't think that I agree with this really. I think that you'd need to be quite a long way into your career before the fact that you went to Bristol UWE rather than Bristol University ceased to matter.

Oldernotwiser

MrsAverage wrote: »

Does anyone know what happens to the thresholds and repayment rates if a student ends up living and working abroad?

I know they are likely to be chased for repayments even if emigrated - but what if that country has a much lower, or higher, average annual salary?

The threshold for repayment varies on a country by country basis, although I wouldn't think that the thresholds for post 2012 students will have been published yet.

Oldernotwiser

amiehall wrote: »

Well tbh I'm not sure I would trust them to raise the threshold. The last threshold hasn't been raised even through several years of 5% inflation. Clearly it's not written into the t&c that they must raise the threshold so why would you trust them to do it particularly when they haven't bothered to in the past.

The repayment threshold went up from £10,000 to £15,000 in 2005, having been introduced 5 years earlier. The threshold for pre 1998 loans has been increased regularly ( every year, I think).

amiehall

Oldernotwiser wrote: »

The repayment threshold went up from £10,000 to £15,000 in 2005, having been introduced 5 years earlier. The threshold for pre 1998 loans has been increased regularly ( every year, I think).

I see. I have a small loan from 2006 that I've had to make repayments towards. As that was the first top-up year, and people were having these same kinds of hysterical discussions, I really thought it was mentioned that the threshold was designed to increase then too. Same as this really, people putting it forward in the way that it's their general intention to raise it, it's just they've never gotten around to doing it. I've never had an increase in repayment threshold the life of my loan. But tbh it was 5 years ago and I was 18 so....

Kiirk

I'm a student, and I am a bit undecided if I should take a loan out for the second + third years.

Financially I can support myself for the full three years, taking the fee loan, but not the maintenance loan. (Currently what I've done for the first year).
However when I leave university, I wish to buy a house within a few years. Assuming I would have enough to put down the deposit and I could get a mortgage, this poses me the following question:

Is it ALWAYS better to take the full loan? From the guide, it suggests if you are earning over £35k a year it is best to avoid the loan. But is this always the case?

melancholly

Kiirk wrote: »

I'm a student, and I am a bit undecided if I should take a loan out for the second + third years.

Financially I can support myself for the full three years, taking the fee loan, but not the maintenance loan. (Currently what I've done for the first year).
However when I leave university, I wish to buy a house within a few years. Assuming I would have enough to put down the deposit and I could get a mortgage, this poses me the following question:

Is it ALWAYS better to take the full loan? From the guide, it suggests if you are earning over £35k a year it is best to avoid the loan. But is this always the case?

just to clarify, as it sounds like you're already a student, are you already at uni? if so, you're under the existing system, not the new one. so your total will be lower and your repayment threshold lower. plus there are no early repayment penalties. if that is the case, then it's much simpler - take the loan, keep your savings earning interest at as high a rate as possible (which at the moment, might mean locking it away for a period of time), then decide after graduation whether to pay back slowly or all at once (remembering to consider interest rates for the life of the loan rather than just on what they are now). it's probably best to just pay back on the standard terms, at least to start with, then use your savings on a house deposit, or as a buffer in case you don't get a job immediately after graduation. you're in a great position to have these savings that could be a support blanket - in the current economic climate i'd be reluctant to get rid of that.