Saving for university costs: How much?

grey_gym_sock

this is getting silly ... ppl are different, and OP is in a better position than the rest of us to judge how her children will respond.

atush

I dont see why parents think subsidising their kids, beyond basic living costs is necesaary.

well you can say that. but in fact that is all i am doing. I pay rent and food, but I have been castigatged, and you have not supported my view?

atush

grey_gym_sock wrote: »

this is getting silly ... ppl are different, and OP is in a better position than the rest of us to judge how her children will respond.

well said. And I notice most who oppose either got free education, grants or even just had to pay 1-3K per annum for fees.

And they are all paying the old SLC rate- not the new onerous one.

MrsCautious

Thanks everyone for your thoughts, there's a lot for me to think about, I'm glad I asked, I think as the thread has progressed it's clear my desire to help is rooted in my own experience of not having that help when I was a student, the replies are enlightening. I may smart a little from the suggestion helping them is a waste of money but hey-ho, like many other parents I'm thinking of helping them as I can so they don't have to compromise their well-being by running themselves ragged to avoid debt, not chucking tens of thousands each a year at them to !!!! up the wall.

Thank you atush and grey gym sock for your insights and thanks all for the food for thought. I don't need to be informed again of the simplistic stereotype that says if I put my hand in my pocket to help my daughters that I'm somehow stifling their ability to appreciate money/develop ambition and all the rest of it. That's what I believed 20+ years ago and I was wrong. Nor do I buy a suggestion that the fact they are girls makes it more of a waste. What mum would?

One thing discussing this here has highlighted for me is that I remain unclear about how parents' income and in my case, more importantly, savings, impact on loans/grants. I'm guessing that only interest on savings/investments is taken into account but really need to understand that better.

GreyCat

On the question about how the Student Loans people treat savings - as far as I can tell having filled in their forms a couple of times, they are only interested in the same information that you have to put on a tax return. So any income from savings and investments in ISAs isn't counted. And they seem to work on taxable income from the tax year before last, although you can ask to be assessed on current year income if it's gone down significantly. I found their forms a bit difficult to follow (in terms of what information they actually needed) but their helpline refreshingly helpful and forthcoming with useful info even when I wasn't asking the right questions!

In terms of how much financial help you should give your daughters - it's obviously very subjective (from the answers above!). Personally I think it depends on what you want them to get out of their time at university. It's not just about getting a degree. It's a unique period of life when they can make friendships and create networks that may last them a lifetime, try out new things, and maybe discover what they want to do with the rest of their lives. As well as learning to take responsibility for themselves as adults. Depending on the young person, that might include spending time doing a minimum wage job - or they might be better spending their time involved in student sports or other interest groups, politics, volunteering.... Most of these things have costs (and don't forget about costs of travel, during term time and to get home in holidays, materials costs if they're doing an arts course, etc etc). It should be possible to work out likely costs of living plus activities for a given course/ uni, deduct likely loan income, deduct how much you think they should earn themselves each year, and the difference is what you'll need to fund (times number of years of course - could be more than 3). You can be fairly sure studying in London will cost a fair bit more than elsewhere. For mine, we worked out a budget that covers everything she needs and a small amount for things she doesn't need (socialising). Anything else she doesn't 'need' (more socialising, holidays etc) she has to find a way of funding herself. She also knows that there isn't any more money available if she overspends, so stays within the budget.
In the long run, I think investing in her having the most productive possible uni experience will be more useful to her than saving the money back to support early investment in a house. But in the end it comes down to which is most important to you/them.

flea72

MrsCautious wrote: »

Nor do I buy a suggestion that the fact they are girls makes it more of a waste. What mum would? .

Oh course education isnt a waste (am currently at uni myself), i was just pointing out that as a women, most will either stop work when having kids or at least return p/t so wont be meeting the repayment criteria

Your Orignal Q was how much to save to save to put your DDS through uni. The answer is, you dont have to save anything. The loans are more than adequate for a student to live on, the loans might not need to be repaid and if they do, the repayments are so low, your DDs wont even notice the money coming out of their pay each month

grey_gym_sock

wont even notice the money coming out of their pay each month

ha! ... 9%, won't even notice? ... imagine a political party saying: we'll put up income tax by 9%, but don't worry: you won't even notice!

mary

Using MSE's Student Calculator:
Tuition fees: £9k, Maintenance Loan £7675 (London) & 3 year course, average salary of £25K. All other default settings, I get the following.

http://www.moneysavingexpert.com/stu...nce-calculator
It says What you Repay £40,570

Can anyone tell me is the £40,570 "what you repay" just the bit you repay off the capital? Because in the process over 30 years you are parting with a lot more money than that when you factor in the interest. If I am correct in my thinking, I am wondering why the interest is not included as well, as surely this would give a true picture of just how much the "real" student loan actually costs the individual.

Would appreciate an answer to my question, as I;m not sure if I am understanging correctly.

Thanks

atush

Well 9K plus 7675 K (which you cant live on in London) x3 is over 50K by my calcs.

And that doesn't take into acct 9% interest every year on your balance.

mary

Yes I know you can't live on 7675 in London, but that is the max loan you can get for maintenance. My point was specifically referring to the calculator, the £40,570 it claims "you repay" - does that refer to the capital part of the loan only or the capital plus interest over the 30 years?