Martin: Student loan statements are dangerous & misleading - so check out our redesign - MSE News

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MoneySavingExpert.com and the Russell Group of universities are piloting a proposed redesign of the student loan statement and are calling on parents, students, graduates, and those in the higher education sector to test it and give feedback...
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'Martin: Student loan statements are dangerous & misleading - so check out our redesign'
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  • callum9999
    callum9999 Posts: 4,393 Forumite
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    While making it simpler is always the best thing to do, it's somewhat concerning that university graduates need to be hand-held through such an incredibly simple concept.
  • peterbaker
    peterbaker Posts: 3,083 Forumite
    edited 27 February 2019 at 12:51PM
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    callum9999 wrote: »
    While making it simpler is always the best thing to do, it's somewhat concerning that university graduates need to be hand-held through such an incredibly simple concept.
    I think most of the first Plan 2 university graduates with a world view have already put simple-mindedness well behind them. The total short-sightedness of HMG too. I think Plan 2 sufferers treat the whole 9% surtax thing and the people who designed it and who continue to champion it with the total disdain it and the designers deserve i.e. they have long ago mentally filed it without even giving it a thought from one month or one year to the next. Afterall, the dumb-a$$ed UK voting population doesn't either value or support them.

    I'm aware of Plan 2 kids amongst family and friends and one suffers not 9%pa, but 15%pa surtax on income over £25K ... if MSE has to continue doing SLC's work for it, then why isn't that mentioned? How on earth is the likelihood of a 15% surtax any kind of incentive for the best of the UK's young people to strive for a decent start?

    Amongst friends and family I also know of a graduate in Europe who has spent no less than 7 years at university (free) and walked straight into a £60,000pa starting salary job. They now pay the same tax as any other citizen does on that salary - not a percentage point more or less. And so it should be.

    I'm also aware on the other hand of super skilled and committed UK apprentices who've endured low wages for the period of their apprenticeship, put their heart and soul into training and the company, passed the course and then when it is time to join the main payroll got dumped as surplus to current requirements. That's another concept mis-sold to UK students in their mid-teens i.e. that if you know what you want to do, and apprenticeship is an equally valid alternative to university. Wrong. You will still have to compete to get a job at the end of it and if you are second best, then who knows where you will end up?

    But back to Plan 2 loan scheme, I wish MSE would take a much stronger political stand on this and use its resources to constantly lobby that the entire Plan 2 student loan scheme flies in the face of financial services law instead of meekly offering to tart up the design of the loan statements. And please don't anyone bleat back that the loan scheme isn't missold because it is statutorily exempt from the normal law - how on earth did the passing of law containing that disgraceful exemption ever uphold any public good??

    The best message to prospective Plan 2 students, or those still studying with it round their necks is similar to that we might give them on how to break free of the stale environment of dumb parents and grandparents, and other stuck in the mud associates who do stupid things like vote Leave in EU referenda without asking your opinion.

    The message is: Do what you have to do and get out and away from it, and make your own way in the wider world just as soon as you can - if you wait for things to get better or for opportunity to come to you, and waste even a second worrying about what drops through your letterbox or inbox from SLC you will prematurely start becoming the second class citizen and wage slave that those who run your country want you to be. Oh and get another passport if you can.

    Playing UK and HMG games their way means you will soon become as lost, unwanted and depressed as your country now is.

    You are better than that. Plan 2 was a form of state-sponsored and voter supported later childhood abuse that you have endured, and I for one apologise on behalf of my baby-boom generation for having blindly voted for politicians who dumped it on you.

    May you get the best of luck in this world and rise well above the nonsense you've suffered and which your country wants you to continue to suffer in the guise of the ugly Plan 2 scheme.

    Interest at RPI +3%pa and with repayments of up to 15%pa not 9%pa of the larger parts of the salaries you earn and deserve is appalling, and so are the disgusting salaries that UK university vice-chancellors have been paying themselves from your future earnings, and the crazy rents they charge you for crap student accommodation. If you have escaped all that and now found a decent full-time job, don't be conned into thinking you owe your country one penny for your success. You did it despite your country's short-sightedness.

    No, your country owes you big time for dipping into your future earnings and squandering it before you even get started in life; and if you go on to do great things despite them, you can bet your country will ride on it and you, and claim credit. By then you might know best how and where to tell them they can get off ...
  • silvercar
    silvercar Posts: 47,082 Ambassador
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    callum9999 wrote: »
    While making it simpler is always the best thing to do, it's somewhat concerning that university graduates need to be hand-held through such an incredibly simple concept.

    Blame the lack of financial education in schools, something that Martin Lewis is trying to put right.

    Also remember that parents of (potential) university students are as often in the dark about funding as students themselves.
    I'm a Forum Ambassador on The Coronavirus Boards as well as the housing, mortgages and student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.
  • silvercar
    silvercar Posts: 47,082 Ambassador
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    Peterbaker- a long reply that I won’t quote in entirety, but once a student has taken the loans they are obliged to repay, so suggesting they escape is fruitless.

    For anyone unclear a 15% repayment occurs when a student has an undergraduate loan repaying at 9% of income above the threshold together with a post graduate degree repaying at 6%. The two are cumulative so reach 15% (at least until the post grad loan is repaid).
    I'm a Forum Ambassador on The Coronavirus Boards as well as the housing, mortgages and student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.
  • Ed-1
    Ed-1 Posts: 3,906 Forumite
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    silvercar wrote: »
    Peterbaker- a long reply that I won’t quote in entirety, but once a student has taken the loans they are obliged to repay, so suggesting they escape is fruitless.

    For anyone unclear a 15% repayment occurs when a student has an undergraduate loan repaying at 9% of income above the threshold together with a post graduate degree repaying at 6%. The two are cumulative so reach 15% (at least until the post grad loan is repaid).

    Also worth noting the postgrad loan threshold is still at £21,000 with no uprating. And the interest is RPI+3% flat from the start and doesn't vary.

    So it's effectively 9% over £18,330 (plan 1)/£25,000 (plan 2) + 6% over £21,000.
  • silvercar
    silvercar Posts: 47,082 Ambassador
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    Ed-1 wrote: »
    Also worth noting the postgrad loan threshold is still at £21,000 with no uprating. And the interest is RPI+3% flat from the start and doesn't vary.

    So it's effectively 9% over £18,330 (plan 1)/£25,000 (plan 2) + 6% over £21,000.

    True, though there won’t be many people on plan 1 with a post grad loan as post grad loans started in September 2016 and the last plan 1 loans were for those starting degrees September 2011. So most of those that take post grad loans started uni sept 12 or later.
    I'm a Forum Ambassador on The Coronavirus Boards as well as the housing, mortgages and student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.
  • Ed-1
    Ed-1 Posts: 3,906 Forumite
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    silvercar wrote: »
    True, though there won’t be many people on plan 1 with a post grad loan as post grad loans started in September 2016 and the last plan 1 loans were for those starting degrees September 2011. So most of those that take post grad loans started uni sept 12 or later.

    I know 3 people who are on plan 1 and all 3 started doctoral courses this year and have a postgrad loan of £25,000 (they couldn't take one for their masters which they completed in 2015 though).
  • callum9999
    callum9999 Posts: 4,393 Forumite
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    silvercar wrote: »
    Blame the lack of financial education in schools, something that Martin Lewis is trying to put right.

    Also remember that parents of (potential) university students are as often in the dark about funding as students themselves.

    They are fully grown adults who have received 3 years of specialized training in how to find information relevant to them. A "lack of financial education in schools" is a lazy cop out.

    I witness it myself all the time when I point out to friends how if they change how they do X then they would save money, but they rarely bother to do so. A particularly annoying case is someone paying for a Santander 123 account who pays their utility bills by debit card!

    There are endless financial education resources available at the click of a button, and every single one of them knows how to find it. If they choose not to, it's on them.
  • callum9999
    callum9999 Posts: 4,393 Forumite
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    peterbaker wrote: »
    I think most of the first Plan 2 university graduates with a world view have already put simple-mindedness well behind them. The total short-sightedness of HMG too. I think Plan 2 sufferers treat the whole 9% surtax thing and the people who designed it and who continue to champion it with the total disdain it and the designers deserve i.e. they have long ago mentally filed it without even giving it a thought from one month or one year to the next. Afterall, the dumb-a$$ed UK voting population doesn't either value or support them.

    I'm aware of Plan 2 kids amongst family and friends and one suffers not 9%pa, but 15%pa surtax on income over £25K ... if MSE has to continue doing SLC's work for it, then why isn't that mentioned? How on earth is the likelihood of a 15% surtax any kind of incentive for the best of the UK's young people to strive for a decent start?

    Amongst friends and family I also know of a graduate in Europe who has spent no less than 7 years at university (free) and walked straight into a £60,000pa starting salary job. They now pay the same tax as any other citizen does on that salary - not a percentage point more or less. And so it should be.

    I'm also aware on the other hand of super skilled and committed UK apprentices who've endured low wages for the period of their apprenticeship, put their heart and soul into training and the company, passed the course and then when it is time to join the main payroll got dumped as surplus to current requirements. That's another concept mis-sold to UK students in their mid-teens i.e. that if you know what you want to do, and apprenticeship is an equally valid alternative to university. Wrong. You will still have to compete to get a job at the end of it and if you are second best, then who knows where you will end up?

    But back to Plan 2 loan scheme, I wish MSE would take a much stronger political stand on this and use its resources to constantly lobby that the entire Plan 2 student loan scheme flies in the face of financial services law instead of meekly offering to tart up the design of the loan statements. And please don't anyone bleat back that the loan scheme isn't missold because it is statutorily exempt from the normal law - how on earth did the passing of law containing that disgraceful exemption ever uphold any public good??

    The best message to prospective Plan 2 students, or those still studying with it round their necks is similar to that we might give them on how to break free of the stale environment of dumb parents and grandparents, and other stuck in the mud associates who do stupid things like vote Leave in EU referenda without asking your opinion.

    The message is: Do what you have to do and get out and away from it, and make your own way in the wider world just as soon as you can - if you wait for things to get better or for opportunity to come to you, and waste even a second worrying about what drops through your letterbox or inbox from SLC you will prematurely start becoming the second class citizen and wage slave that those who run your country want you to be. Oh and get another passport if you can.

    Playing UK and HMG games their way means you will soon become as lost, unwanted and depressed as your country now is.

    You are better than that. Plan 2 was a form of state-sponsored and voter supported later childhood abuse that you have endured, and I for one apologise on behalf of my baby-boom generation for having blindly voted for politicians who dumped it on you.

    May you get the best of luck in this world and rise well above the nonsense you've suffered and which your country wants you to continue to suffer in the guise of the ugly Plan 2 scheme.

    Interest at RPI +3%pa and with repayments of up to 15%pa not 9%pa of the larger parts of the salaries you earn and deserve is appalling, and so are the disgusting salaries that UK university vice-chancellors have been paying themselves from your future earnings, and the crazy rents they charge you for crap student accommodation. If you have escaped all that and now found a decent full-time job, don't be conned into thinking you owe your country one penny for your success. You did it despite your country's short-sightedness.

    No, your country owes you big time for dipping into your future earnings and squandering it before you even get started in life; and if you go on to do great things despite them, you can bet your country will ride on it and you, and claim credit. By then you might know best how and where to tell them they can get off ...

    What utter nonsense! Calling student loans "child abuse" is absurd and makes you lose all credibility (not that the rest of your post gave you any anyway).

    Under the student loans system, the wealthy pay their fees and the poor pay little to nothing. Under the system you seem to propose, everyone pays it for you. That is in no way "progressive" or "fair", so you have no moral high ground in calling for it. And of course you owe the country for your success. I have no idea about you, but there's no way in hell I could have afforded to go to university without the student loans system. I literally could not have done it without government support so yes, I do "owe" them.

    Do you also have a good explanation as to why a shelf-stacker in Tesco should have contributed towards my university education, despite me immediately moving abroad and therefore not using it to benefit them or the UK in any way, shape or form?
  • peterbaker
    peterbaker Posts: 3,083 Forumite
    edited 1 March 2019 at 12:21AM
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    silvercar wrote: »
    Peterbaker- a long reply that I won’t quote in entirety, but once a student has taken the loans they are obliged to repay, so suggesting they escape is fruitless.

    For anyone unclear a 15% repayment occurs when a student has an undergraduate loan repaying at 9% of income above the threshold together with a post graduate degree repaying at 6%. The two are cumulative so reach 15% (at least until the post grad loan is repaid).
    Yes and is that not a terrible further wrong of the scheme? I am not suggesting that students attempt to escape payment - merely that for their own sanity they seek to escape having to be reminded of the scheme they are stuck with, especially by those who insist on quoting its features like some totally uncaring mantra.

    Graduates already caught up in it certainly do not need to waste time reading how 9%+6%=15%, but on the other hand, your post might I suppose be a salient example of further misleading propaganda about the whole arrangement which prospective undergraduates might need to heed in order to give the whole dodgy system a miss.

    So a message to those poor unfortunates who are approaching the time to decide on whether to go to university might be that if you are the cleverest of the bunch, you'll probably automatically be planning five years before finishing at university so unless you are planning medicine or alternatively just a few other available integrated courses leading directly to a Masters, the repayment system is stacked against you. So it's 15% not 9% for a Masters.


    If anyone is naive enough here to think a Masters graduate needs reminding how they were stitched up by their country and a bunch of wonkas as never before masquerading as government ministers propped up by faceless civil servants on stupid salaries and expensive pensions, so as to end up with a surtax of 15%, then I guess I am not surprised.

    Or maybe that post about the extra 6% and where it comes from is perhaps targeting a general audience at MSE who don't give two hoots about the way young people with the best brains are being routinely stuffed during and after their university educations.

    It reminds me very much of tall poppy syndrome which the UK suffered 25-30 years ago in its schools where football was king and swots were routinely ridiculed so badly that they were afraid to excel. And I suppose many of those ridiculers are on MSE today.

    In 2019, the employment of some stupidly unfair distinction between first degree (usually Bachelor) and "post-graduate degree" to somehow justify increasing the repayments from 9% to 15% is appalling. A Bachelor generally needs to continue with a further degree to stand any chance of getting a decent job.

    What on earth was the thinking behind the repayment discrimination?
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