Saving for university costs: How much?

atush

Well, as it doesn't cover the 50K in max loans it can't be the Capital part. That was the point of my post.

It must be the interest. But seems lower than 9% to me, and that is the new rate.

flea72

grey_gym_sock wrote: »

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!

When earning £21k and paying £7/m, no i dont think most people would notice, tbh.

yes, 9% does sound an alarmingly high figure, but when you work out the actual repayments its a pittance, in comparison to earnings

The only losers repayment wise, are those who fall into higher tax brackets fairly soon after graduation as they will loose so much in tax, have large sf repayments, and actually repay their loans within the 30yr timescale (usually within 5-10yrs of graduating). Everyone else, will never repay their loans, so i dont see why people are worrying about how they can afford the repayments, nor the financial hardship it is going to cause, when wanting to start out having a mortgage/family.

As ive already said, people earning £21k dont bat an eyelid at paying £40/m for a mobile phone contract, but £7/m is viewed as an unaffordable amount

atush

But the payment won't pay off capital at that rate. AS general rule, I never borrow what I don't intend to repay.

I dont know about you, but I would not pay 9K per annum in fees if I thought I would be earning so low as to not pay the loan off. My eldest is on course with a grad job to be earning in excess of 45K in a few years from graduation. Not everyone does this, but many do even better.

theoretica

When I went to university there was clear guidance what parents 'should' pay - as I remember the difference between the full maintenance loan and grant and what I was eligible for. Is this no longer the case? I found this covered the basics during term time - a room, bike, food, charity shop clothes but not expensive hobbies, alcohol or much travel costs.

atush

It is no longer the case as they raised the interest rate fairly high. More than a mtg rate. When did you go? When it was free tuition? 1K? 3K?

And yes, my kids have some expensive hobbies. which they have found they wont be able to pursue next year as they have to earn the money for that if they run thru the bday and pocket money they saved for 18 years. I should say I made them save.

But their dad went to Cardiff on a full grant, and still managed to go see footie games. Maybe they are just that much more expensive now in comparison.

Once they knew what money was, they wanted to spend it, and I didn't let them. I was the 'worst mother in the world' for that, as their friends were allowed to spend theirs lol.

But there won't be any more of that coming their way, so they have to earn or live w/o. I pay only for room and food plus books and travel home.

brenda10

apt wrote: »

I wouldn't say 'the north' is uniformly cheap. Durham is a large university for the size of the city so rents are quite high. Newcastle - the residential area closest to the universities - Jesmond - is not a cheap area. York - quite an expensive city - etc. etc.

Apt I agree my daughter studied in Newcastle for 4 years, she took out loans, I paid her flights to visit us across the water as a treat, she asked for nothing, has now approx £25k of student loan debt but has qualified and got a job since last august in London. Newcastle rents were extortionate at least £350 per student when renting 5 bedroom house, that was before bills, the univeristy for shared flat was at least £100 per week. My daughter is working now and starts to pay back her student loan in small payments in april,(the year after they qualify if they have a job) student loans are the cheapest loans you can get(martins money tips always said that as 1.5%). She is now saving for a downpayment to hopefully get a mortgage between her and her boyfriend who also qualified with her and is working in London. I have encouraged her to live on a budget all through university but living across the water from me has made it expensive re travel and difficult for me to help out physically. I am saving some small amounts for her now in an isa and she the same so as loans are the cheapest way to get through university I would recommend them. Good Luck with all.:beer:

atush

your daughter qualified for 3K fees, and 1.5% Student loans. So her debts will be affordable for her if she earns enough. Todfays students wil have loans double that and more.

the fees are now 9K, and the interest charged is now 9%. So I assume Martin has changed his tune about their affordability.

Yes, my son paid about 340 per week in rent w/o bills at Birmingham for a room in a shared house. The yield on student houses is so high, some investors specialise in them.

flea72

atush wrote: »

I dont know about you, but I would not pay 9K per annum in fees if I thought I would be earning so low as to not pay the loan off. My eldest is on course with a grad job to be earning in excess of 45K in a few years from graduation. Not everyone does this, but many do even better.

As you now need a degree to be do any skilled job within the nhs, ie nurse, odp, etc that would mean noone would go into those type of jobs. Most graduates enter the nhs at band 5, so earning just enough to be making sf repayments. However, moving through the bands takes a long time, and most wont even reach the £45k your son is expecting to earn.

For alot of people on low incomes, getting a degree and earning £21k is a big step up. Paying back your student loan, is not a consideration. Yes its great if you get a job that pays well enough to clear your sf loans, but its not that big a deal for most people. Its a necessary evil

atush

We don't get enough nurses, if they have to pay the full 9K, then the govt may see the error of their ways and have to subsidise fees on courses that are necessary. As we can't have all our nurses coming from overseas.

When they set the cap at 9K, they truly thought less than half of courses would charge that. They were very wrong.

grey_gym_sock

atush wrote: »

When they set the cap at 9K, they truly thought less than half of courses would charge that. They were very wrong.

didn't they cut other funding for universities at the same time as raising the maximum fees? so i expect they knew very well that most universities would try to re-coup the missing money in the obvious way.