Tuition Fees Loan Problem

Derivative

My annual loan amount is roughly £7k at the minute - so that'd be £12.5k with £9000 fees.

If you take the annual loan as rising by inflation of 3%, and the interest on the loan as 6% (inflation + 3%), then you get the following balances:

3 year degree £41000
4 year degree £57000

So yes, I'd agree £50k is not the realistic figure for most, as 4 year degrees are not the norm.

I would say that it makes it very important to work out whether or not a 4 year degree is required though.
For me, an extra year means another ~£8000 on the loan, plus roughly a years' lost salary.
For the new students, it'll mean £16000 and the year lost.

2sides2everystory

Oldernotwiser wrote: »

Although loans are far more than anyone would wish, the situation isn't helped by exaggeration. The majority of students on a 3 year course and studying outside London will leave with a debt of £43,500 at current rates

So how is £50,000 any less valid an estimate than £43,500, ONW? We are talking real people here, not spreadsheets with limited input parameters and biased views on the output.

Let me ask you this: If the largest bank overdraft supposedly available to undergraduate students with no income was about £1,000 when tuition fees were £1,000 pa, and the largest available generally even now is only about £3,000 for a final year student with real prospects, then do we expect overdraft facilities to be say up to £9,000 for 2012 starters at some point before 2015?

And if so, doesn't that make your bleat about exaggeration after someone suggests a £50K debt will be a typical minimum sound rather petty when you insist on pegging it back to £43,500 and qualifying your number by calling it a 3 year course (only) and outside London? Can we please at least be realistic about the way debt is racked up by undergraduates?

... and for those from poorer families who get a grant it will be considerably less.

And what proportion of the total will actually find that they need to borrow 'considerably less', and how little is 'considerably less' ? A net £40,000, or £30,000, or maybe a net £10,000 ? Have you any real idea please? Many of us I think would really like to hear some firm evidence of considerably lower numbers.

For many, having to pay £1,000 pa fees up front was a far bigger problem.

Really, and was that "many" at all similar to any other group of 2012 poor fortunates you have placed exaggerated emphasis upon who will be so much better off when they start in 2012? I sometimes wonder what the current model is for a student from a "poor family" in the UK. Do they use cash or do they live in a world where they exchange identifying vouchers for everything they need ? Do they get free books and free college scarves and free train tickets, free shopping at Tesco, free paper and pens, free dentistry (and I don't mean a mouthful of free Mercury amalgam, thanks). Do they get free respite breaks ? Free beer in moderation? No ? OK what about a free overdraft ? How big ?


What loan budget would you say a budding London undergraduate might need to consider if they had made their decision to go to university conditional upon doing a meaningful Masters course with a year out in industry, or not at all because 3 year degrees are two a penny?

EdgEy, 4 year degrees may not be the norm at the moment, but the universities are currently flogging the concept to the 2012 intake like a 3 year degree is for 'also rans' i.e. that it might be the current day equivalent of a non-honours (ordinary) degree in my day i.e. no great shakes and in this employment market, not a very negotiable asset at all.

Derivative

2sides2everystory wrote: »

the universities are currently flogging the concept to the 2012 intake like a 3 year degree might be the equivalent of a non-honours (ordinary) degree in my day i.e. no great shakes.

Have you ever put any thought into why this might be the case?

Hint:
1980 participation rates were under 15%.
2009/10 participation rates were ~47%.

2sides2everystory

What's your point EdgEy? So participation rates are significantly different, but if all else was equal then surely there'd still have been a noticeable requirement for many more Masters courses in the old days ? The current day phenomenum I think must reflect something else - dumbing down of standards and the need to compete more fiercely in a dire employment market. I dare make no signal about which is predominant because I have reached the stage where I can no longer keep up with much of the Maths my eldest is doing and he hasn't started university yet!

There was a considerably sized second tier of graduates 'in my day' who went to Polytechnics and so got ordinary degrees and who still easily got good jobs.

But if anyone went to a university for an honours course at that time and came out with an ordinary degree then they would easily admit to flunking it.

I appreciate far fewer of the population became graduates of any kind when I went, but as a relative proportion of all undergraduates now embarking on science and engineering courses at least, I detect that a very similar proportion of the total are aiming to complete a Masters now to those who were simply aiming for a 3 years honours degree three or four decades ago and could expect to emerge into a buoyant employment market.

Three or four decades ago very few had any plan to do Masters degrees until they had almost completed and mastered their Batchelor course and made a decision that it was necessary for some very specialised next step.

The way it is being flogged right now at many unis is that undergraduates for BSc or MSc all start together on the same course and may start out with intentions for either. They may be encouraged to tone down their expectation based on their entry A level grades but if they show promise they can easily upgrade their intention at the end of the first year. Similarly if they flunk their first year, they may be strongly encouraged to downgrade at that point.

A year out in industry is strongly encouraged particularly for engineering students and may be taken between the second and third or third and fourth years of a Masters course for example. The level of support from the universities in actually assisting the undergraduates in obtaining a placement varies a lot I think.

Either way, such commonly extended periods of higher education would cost significant extra money two ways as you have several times demonstrated in your estimations.

Derivative

2sides2everystory wrote: »

What's your point EdgEy? So participation rates are significantly different, but if all else was equal then surely there'd still have been a noticeable requirement for many more Masters courses in the old days?

Proportionally three times as many people are going on to higher education than did before.

This makes an honours degree less valuable in the marketplace.

Not exactly rocket science, is it?

2sides2everystory

Well clearly you ain't equipped yet to compare anything other than apples and oranges, derivative, despite your promising new user name, EdgEy.

When I went to university, there were ten times as many farmworkers in the UK than there are now, and a typical high-street-ful of shopworkers barely had a few handfuls of O levels between them. Rocket scientists worked on sea skimming rockets not on customer scamming rackets and good teachers were called Sir or Miss because they were respected for their constancy not knighted for their scarcity.

You may care to chew on that, and everything that falls between your experience and rocket science which may not be your forte, then try your chances with another two-liner.

Oldernotwiser

Derivative wrote: »

Proportionally three times as many people are going on to higher education than did before.

This makes an honours degree less valuable in the marketplace.

Not exactly rocket science, is it?

Three times? The proportion's far higher than that.

Oldernotwiser

2sides2everystory wrote: »

So how is £50,000 any less valid an estimate than £43,500, ONW? We are talking real people here, not spreadsheets with limited input parameters and biased views on the output.

£43,500 isn't an estimate, it's the current figure.



And if so, doesn't that make your bleat about exaggeration after someone suggests a £50K debt will be a typical minimum sound rather petty when you insist on pegging it back to £43,500 and qualifying your number by calling it a 3 year course (only) and outside London? Can we please at least be realistic about the way debt is racked up by undergraduates?

Pardon me for being accurate and using the figures for the majority of students (ie on 3 year degrees and not living in London.)

And what proportion of the total will actually find that they need to borrow 'considerably less', and how little is 'considerably less' ? A net £40,000, or £30,000, or maybe a net £10,000 ? Have you any real idea please? Many of us I think would really like to hear some firm evidence of considerably lower numbers.

See below.

Really, and was that "many" at all similar to any other group of 2012 poor fortunates you have placed exaggerated emphasis upon who will be so much better off when they start in 2012? I sometimes wonder what the current model is for a student from a "poor family" in the UK. Do they use cash or do they live in a world where they exchange identifying vouchers for everything they need ? Do they get free books and free college scarves and free train tickets, free shopping at Tesco, free paper and pens, free dentistry (and I don't mean a mouthful of free Mercury amalgam, thanks). Do they get free respite breaks ? Free beer in moderation? No ? OK what about a free overdraft ? How big ?


It's a bit early to start drinking, don't you think?


What loan budget would you say a budding London undergraduate might need to consider if they had made their decision to go to university conditional upon doing a meaningful Masters course with a year out in industry, or not at all because 3 year degrees are two a penny?

Obviously a London student will rack up higher debts, as will someone on a four year degree but they are in a minority.

.

Students from families earning below £25,000 (studying away from home and outside London) will be borrowing no more than £36,500 (effect of maintenance grant on maintenance loan) and possibly only £23,500 if they go to a university who are charging 50% of normal fees. Most, I would expect, will be borrowing between these two figures.

The latest figures I've seen show that around 25% of students come from families with an income below £25,000 (the level where they qualify for full grants) and, as you pointed out recently, fortunately this group don't seem to have been put off by higher levels of borrowing.

Derivative

Oldernotwiser wrote: »

Three times? The proportion's far higher than that.

I chose 1980 as the benchmark, and that includes all forms of HE not just Universities. It's difficult to find accurate data as institutions have changed (polytechnics are now full universities, etc.

Far more than three times are getting honours degrees, I agree.