spend, save or put towrds university fees?!

Lokolo

Personally I would do the mortgage thing, its got interest on it, just try and get rid of it asap.

Student loan wise, let them take it out but tell them its their responsibility. I was lucky in that my grandparents are rich and are paying for living costs. But I still took out the loan and I am sticking it in a savings account (I am getting 6.05% and the loan is costing me 4.8%) which I then plan to use when I also get a house.

And to be honest it really does depend on where you daughter is going to uni, there is huge amounts of difference in costs. My accomodation cost £2285, whereas my friend cost in the region of £3500 (more than he gets for his student loan). Take into consideration how much her accomodation is, but make her get a job over the summer, trust me, it'll help!

phebe3

May look at paying off the mortgage...tho where I have the money now in an account linked to my mortgage account means that it's in a savings account attracting interest BUT the amount I have in the SAVINGS account is taken off my MORTGAGE loan whilst the money is in the savings account. This means the amount I owe and pay interest on has dramatically reduced over the last 10 years or so..and it iS nice to see that mortgage amount coming down a lot faster! Re where she is going..Sheffield/Leics/Keele/Nottm etc..depends on grades

Lokolo

I don't really know anything about mortgage so I may be wrong but can you put this money into the savings account as extra? If so surely that will knock a bunch of years off? Do that!

Also if you want some sort of money plan for your kids you could put some money into a normal savings account which you can then get access to if your kids get into trouble or anything.

So like if you want a bit of both, do like 50/50, put some towards mortgage, put some in savings account and to be honest, if you daughter is finding everything ok after 6 months at uni you could take the savings out and put that towards mortgage as well.

margaretclare

chesky369 wrote: »

The world has become a very much tougher place since you and your husband were in education; young people going to university now have more options open to them, especially if they're like your daughter and have no specific idea of what they want to do in the long run. I'd be happy if young people had more opportunities with apprenticeships and with vocational training, but these seem to be more and more lacking in our society.

I agree with all of this. It was a struggle for my family when I stayed on at school ONE extra year to do 'O' levels (now GCSEs) because the school-leaving age was 15 at that time and I left at 16. However, I walked into jobs armed with my 4 'O' levels, some of which I wouldn't have been considered for without them. My DH is an apprentice-trained mechanical engineer but he's a bit equivocal about his 5 1/2 year-long apprenticeship. He says it didn't take him long to learn his trade, and in some respects it was 5 1/2 years of cheap labour. However, he built his career on having 'served his time' as an apprentice, but to become a mechanical engineer now would need much more than an apprenticeship, even including night school to do maths etc.

Having said all that, I think you should pay off the mortgage as soon as you can. If you look at Martin's advice to teenagers, he talks about 'good debt' and 'bad debt'. 'Good' debt is borrowing for something that will appreciate in the long term, and he includes student loans under that heading.

Margaret

tawse57

phebe3 wrote: »

I know what you mean about uni...neither me nor my hubby went and we've done ok (tho he did take degree thru work later on..;the best way to do it and I have done bits of higher ed to get more qulaified throughout my life..but been earning as well)) We find schools and colleges almost indoctrinate kids into going. The senior school was v off with us when in a meeting once we said "IF our children choose to go to uni".they took it for granted we wd be encouraging them to go..which we haven't really. My mmiddle daughter didn't know at 16 you could leave and get a job..she though you HAD to go on to further education! Re the degree and earning...hubby says employers DO look at degrees..depends what you want to do really. Eldest is v acedemic anyway, wants to do maths degree so shd think she will stand a good chance of a job at the end..fingers crossed. Trouble is she doesn't really know what she wants to do so even if didn't go to uni don't know what she wd do.

It is in the school's interests to get as many pupils to go to Uni as possible as it shows up on their figures which means higher up the league tables which effectively can mean more cash.

Also, it depends upon what you wish to do - if you definitely know what you want to do in life and you do the appropriate degree then all well and good. However, as the overwhelming of students do, you have no idea what you want to do and then go and do a degree that has no relevance then what is the point in running up 20 to 30 grand of debt? That will be a millstone around your neck for life.

The other problem with schools, IMPO, is that teachers and head teachers have a big ego come snooty attitude to University - it is the usual class thing in the UK where people somehow thing you are better and well-read if you have a degree. What nonsense. I bet every teacher in your children's school has problems finding a decent plumber, electrician, etc, and when they do I am willing to bet the tradesman not only earns more than them but works when he/she wants and is his or her own boss... plenty of free time to become well read later on.

I strongly urge to do a bit of googling for newspaper articles on the pros and cons of going to Uni. There have been several excellent articles both in the US and UK in recent years regarding this. I think Moneyweek fiancial mag did an excellent article a year or so ago on this.

Finally, I did not say it in my first post but I am sorry to hear of your loss. I hope you have many happy and pleasant memories of your loved one.

Broke_Student

As a student I would suggest you do not worry about saving too much for university costs (unless maybe they all go to London).

I can say first hand that there suitable funding to make ends meet for those that need it, assuming they have a reasonable capacity to budget their money.

There are loans for fees and loans for living costs which charge no real interest and have no demands for repayment. In theory it is cheaper/better to pay the tuition fees with loans instead of savings!

There are also non-repayable grants/bursaries/scholarships/hardships funds for those that are entitled.

I would suggest you provide them with a regular stream of income (e.g. £20 a week into bank accounts) which you may be able to afford straight off your income when they move out (less food bills etc...). Atleast this was they will see a difference being made to their lives with your money - paying off their fees in advance will make no difference to them.

siber

Whatever happens, if anyone is entitled to take out a Student Loan, do so to the maximum amount. Student Loans currently only charge 'inflation-rate' interest, so in terms of value, you'll always owe the same amount, regardless of how long you take to repay them.

Therefore, seeing as the best savings accounts usually pay 2-4% more interest than you're charged on a Student Loan, even if you don't need the loan to live off, take it out and reinvest it in a risk-free savings account. That way, with a £3,000 student loan (assuming you don't need to spend it), you could make around £100-£120 per year after the interest charges! This will compound over the three years and you can add subsequent year's loans to it.

Also, even after graduation, don't pay it off any faster than you have to, because this money can be used to offset other necessary purchases (car, house etc.) which, ordinarily you'd need to get a commercial rate loan for. eg. Use your £10,000 student loan to offset £100,000 mortgage, and you're (effectively) only paying value-interest on £90,000.