[Closed] Can University debts be avoided, or at least reduced?

looks like it could work - from a purely financial point of view.

I don't have kids (yet), but not sure I'd want them to live away from me for those years - fair enough when they are 18, but 16-18 (which sounds like 2 years to me, rather than the 3 you said!) is presumably a fairly critical bit of their development, not to mention some of the best years for biking with their dad.

Would you not miss them?

Dave

Any flaws in this?

What do the kids say about being uprooted away from their social group, or do they not get a say in that?

Needs to be three years living in Scotland to qualify for the free fees.

[i]Would you not miss them?[/i]

Ever been in a house with three Kevins'? 😕

But seriously, they may 'live' there, but would only need to there term time and week-days.

The only flaws I see are the parenting 🙂

Best way to reduce costs is for the students to live at home and commute in. Not quite the same experience but still perfectly fun and without the several thousand quid a year living costs added on.

I keep saying that the Scots have special priviliges that all UK tax payers are forced to support, but am always met with indignant and bemused Scots who think the system is fair. I guess their ungrateful arrogance has much to do with it.

I don't blame students for being ****in angry. The graduates of the older population had it easier than the Scots do now. Why can't they stump up? They made their fortune and have great pensions looming don't they?

The fact of the matter is that higher education is no longer a luxury, but to get a run of the mill job these days, you have no choice! If successive governments hadn't dumbed down secondary education, we would need people to go to expensive universities to catch up. The whole situation has become an expensive inefficient mess - the public sector excels at wasting money!

And our so called right wing government are doing nothing to reduce public spending on higher education! By deferring the fee repayment to when the student earns above a certain level sound much more like running public debt to me!

Politicians, democracy, what a joke!

I can't believe you'd move your kids out of the family home at that age just to avoid uni fees

I miss my kids if they're gone more than a weekend

You seem to be treating them as a financial instrument to reduce liabilities/costs a bit like an ISA or something

The fact of the matter is that higher education is no longer a luxury, but to get a run of the mill job these days, you have no choice!

Simply not true, there are thousands of run-of-the-mill jobs that don't require a degree.

If successive governments hadn't dumbed down secondary education, we would need people to go to expensive universities to catch up.

True, very true. But you still don't need to have a degree for a large percentage of the jobs out there.

if you're going to move 3/5ths of your family, why not just all move north?

Spongebob - Member

I keep saying that the Scots have special priviliges that all UK tax payers are forced to support, but am always met with indignant and bemused Scots who think the system is fair. I guess their ungrateful arrogance has much to do with it.

And you keep being told that this is balderdash. Scotland is a net contributor to the UK, Scotland gets a smaller and smaller % of the uk gdp each year.

Both these things are facts. Have a read up on the Barnet formula

You mean this one

"The Barnett Formula was designed as a temporary measure but has lasted for 30 years.

Lord Barnett, then the Labour chief secretary to the Treasury, drew up a system for the division of public spending in 1978 partly to settle rows with other Cabinet ministers about spending allocations, and partly to allow for Scotland's larger physical area, lower average incomes and its particularly acute needs in health care and housing.

The formula dictates that for every £1 the Government distributes, 85p goes to England, 10p to Scotland and 5p to Wales. With five million people, Scotland now has only 8.3 per cent of the UK population. That has led to a situation where "identifiable spending" in Scotland on public services is £1,500 higher per person than in England, according to Treasury figures."

"But seriously, they may 'live' there, but would only need to there term time and week-days."

I don't think this would work, unless the system has changed. When I was looking at going to uni, I wanted to move away to uni. My mother said she'd only support me if I chose a local university and stayed at home.

I tried to find out if there was any way I could go further afield, but I was told that because of my parent's income I wouldn't be able to recieve much in the way of student loans. I was told the only way my parent's income would be discounted is if I'd been [b]estranged [/b]from them for three years - I'm not sure if sending them to your parents and seeing them every weekend will count. :/

As a result, my choices were limited and I went to a sub-par uni. But on the plus side, I did come out of it completely free of debt, and I got a degree, so for that Im grateful.

gusamac - thats right -.Contrary to what spongeboy said English taxpayers do not support this as Scotland contributes more to the UK economy than it gets.

So to say Scotland gets more money to spend per head of population is correct, to say this is supported by English taxpayers is wrong - and the amount extra is less than some English regions get and is reduced each year.

There is differential allocations of money to every part of the UK with London and the south east gaining the biggest share. Scotlands share of the UK GDP reduces each year.

I knew it wouldn't be long before my arch enemy, TJ rocked up with his misguided nonsense!

I totally agree, there are many run of the mill jobs that don't need a degree, but this doesn't stop employers stipulating that applicants must be university educated.

What do the kids say about being uprooted away from their social group, or do they not get a say in that?

People have to move for a variety of different reasons, financial, work, family etc, children get used to it and make new friends. Since they're not the ones who have to deal with the reality of paying for it all, then they don't get to have much of a say, no.

[i]People have to move for a variety of different reasons, financial, work, family etc, children get used to it and make new friends. Since they're not the ones who have to deal with the reality of paying for it all, then they don't get to have much of a say, no. [/i]
and
[i]I can't believe you'd move your kids out of the family home at that age just to avoid uni fees[/i]

But under this 'new' system its not really me (parents) that will do the real paying - its them, and for a long, long time.

For me this is more about me advising them what is best, for them. There is no way in the world (even at our income levels) that we could afford to pay for their cost of living and fees without ending up with a hugh debt ourselves and not that many years of work left to pay it off.

I'm guess that there are many who've posted who either haven't kids or if they have kids they just haven't fully understood the implication/change that is going on.

I didn't go to Uni, but did go to a local college - would I have done either if I'd have known that my debts on leaving would have amounted to twice/triple the [b]average[/b] wage - and would be paid back at 9% (of salary) over the next 30 years?

You also need to remember the discussion of making all University students pay back the fees from their own earnings, rather than having them paid by 'rich' parents.

And TJ; I really don't give a flying what you think about how the Scots pay for more than they get - 'cos its both irrelevent to this discussion and you are talking out of your backside.

and would be paid back at 9% (of everything they earn over 21k) over the next 30 years?

FTFY

[i]and would be paid back at 9% (of everything they earn over 21k) over the next 30 years?[/i]

so it will take them even longer to pay them back..., or never:

http://www.****/news/article-1201486/Half-university-graduates-poor-pay-student-loans-struggling-lucrative-jobs.html

A guy in the MTB club at uni reckoned he could have done his degree (English) is about 16 months if he worked about 10am to 3pm 4 days a week.

As it was he was there for 3 years just because all degrees (OK, not all but "usual" degrees) are 3 years. He found it ridiculous and this was in the days when most of it was paid for. He went for weeks at a time with 1 or 2 lectures a week.

Universities themselves need substantial reform and it might be an idea if students actually went to them with some intent of working while they were there - I saw so many people who saw it as a 3 year free piss-up. A guy I unfortunately shared a house with for a year was on my course (chemistry) and he barely went to any lectures, came out with a near useless 3rd Class degree and taxpayers were paying for that, paying for him to spend his days down the Union bar. Cut out that waste and the waste of 3 year degree courses for subjects like English and you'll slash the budget deficit.

So, my eldest son is now serious wondering about going to a french university to do engineering.

Fees are much lower and we would at least be able to pay for it on our terms rather than being tied into a deal set by the treasury (possibly?).

His french is reasonable (he's doing 'A' level) and this is apparently one of the top french unis.

Good idea? Or bad?

My daughter will be doing a medical degree. She has accepted the fee situation, has had a part time job since 15, knows she'll have debt when she leaves but sees no option. I could have shipped her off to my parents in N.Ireland, but I like her being around. Her career choice will have a financial outcome but it will have other outcomes too. If she went to NI she'd be at one of the best schools in the UK, but be with none of her friends and live with old grandparents in the middle of nowhere.

I can't speak for how I'll feel in 6/7/8 years time, but at this moment in time I'd probably actively encourage my daughter (now 10yrs old) from going down the further education route.

I'd rather her start work with Mrs TAFKASTR who has her own business, start work with me in my business (a little more complex, but still feasible), or re-direct some of the debt she'd incur at Uni into setting up her own business, dependent on her interests and aspirations at the time.

Do graduates even get jobs these days? The only one I know who I'd class as significantly better off than me has a Phd and does something or other to do with analysing DNA, ergo he's intensely clever and deserves to do well.

Degrees are dirt cheap in Holland and often taught in English - I almost did a Masters there as the fees were something like €2k compared to £8-10k for a UK uni. Problem was their masters degrees take two years, so the loss of earnings wiped out the savings.

As for French unis, some are very very good - IIRC some of the management schools are top 10 in Europe. The FT has international rankings.

Another option is Buckingham University, which is very well ranked and runs two year degrees.

TBH though I don't think the new system is that bad. If you earn low wages for the rest of time, you don't have to pay as much back as at present. If you earn more, then you pay more.

the Scots have special priviliges that all UK tax payers are forced to support, but am always met with indignant and bemused Scots who think the system is fair.

Special privileges because there are no tuition fees ? I think you'll find that it's all down to the way they voted, and voting isn't a special privilege. No one forces the English to vote Tory/New Labour....I certainly never have. It all seems pretty fair to me.

And there won't be any tuition fee increases in Wales btw, again, as a result of the way Welsh people voted (One Wales).

Wot ernie said- they didn't vote for an unfair fee supporting party, so there's no unfair fees. Seems reasonable.

My kids will go to a Scottish uni. No reason why they should have to pay for it.

a friend of mine did an accountancy degree, and as a foreign student she had to pay higher fees than are being discussed, plus cover rent, living expenses etc. She started with little in the way of savings and didn't have bank of mum and dad to fall back on.

She did two jobs and her degree, got a first and came out with no debts, it can be done. But she didn't have much of a life for three years.

As i read it the debts you need to worry about are living costs, not tuition fees as these are dependent on earnings after you leave.

The best way to avoid student debts is to come from a low income family.

The proposed cuts to EMA will mean that it's going to be nigh on impossible for most low income families to support what will effectively be full grown and non wage earning adults through a minimum of two years of higher education in order to get them to university.

Sorted.

Special privileges because there are no tuition fees ? I think you'll find that it's all down to the way they voted, and voting isn't a special privilege.

And yet in 2004 the votes of Scottish MPs helped pass a bill that affected nobody in their own constituencies but imposed higher charges on those attending English universities.

I'm not even going to get into the English students paying higher fees at Scottish universities than any other EU students.

His french is reasonable (he's doing 'A' level) and this is apparently one of the top french unis.

Good idea? Or bad?

Very different system in French unis (also in German ones) - I'd find out a lot about the system, and whether it suits him before committing to anything. I know a bit about German unis, and I don't think I'd want to go there.

Joe

2004 the votes of Scottish MPs helped pass a bill that affected nobody in their own constituencies but imposed higher charges on those attending English universities.

And how is it the fault of Scottish MPs that there is no English Parliament ?

I suggest you aim your criticism at those responsible 💡

I doubt that the Scottish fee system will be in place for anything like the long term, even for the next 3 years is highly unlikely IMO (to the OP's hypothetical of moving his kids there).

The Scottish election is next May, so no MSP's got the bottle to stand up and grasp the nettle of fees at the present time. If and when it becomes clear that people are willing to pay for good degree courses in England, there is no way that SHEFC will continue to fund the same up here, at a lower level.

It would be an interesting experiment if they did keep the no fees policy - we'd have the best and brightest flocking up here to study, in run down, underfunded and poorly staffed universities. It won't happen though - Scotland will align itself with the English system, indeed it will probably benefit from hanging back a few years to see how things go down south.

And how is it the fault of Scottish MPs that there is no English Parliament ?

They could abstain from voting on English only issues.

They could abstain from voting on English only issues.

Why should they do that ? If the English want then to have an opinion and a vote, then why shouldn't they exercise it ?

As I said, aim your criticism at those responsible.

Of course there is no such thing as an England only issue - because of the barnett formula every spending decision in England has an impact upon the scottish block grant.

I don't know if I'm being stupid here but from this

The formula dictates that for every £1 the Government distributes, 85p goes to England, 10p to Scotland and 5p to Wales. With five million people, Scotland now has only 8.3 per cent of the UK population. That has led to a situation where "identifiable spending" in Scotland on public services is £1,500 higher per person than in England, according to Treasury figures."

Which seems to disagree with this

TandemJeremy - Member
gusamac - thats right -.Contrary to what spongeboy said English taxpayers do not support this as Scotland contributes more to the UK economy than it gets.

@BikePawl - I think it depends on how much money the treasury gets from Scotland in relation to the rest of the country.

Imagine if the UK's only income was from selling haggis. 100% of UK government spending would be from Scotland, but only 10% would go back in services.

Luked2 I was assuming that per head of population it balanced out, thereby allowing us to measure income by percentage of population.

Strangely BR you have found a possible way to defraud the system and published it, rules will naow and should be changed.

Also do the kids actually want to go into uni, not get worthwhile jobs and study part time at nigh or on block relaease, or even open univercity.

Anyway scotklands bust they didnt have enough salt /grit/snow ploughs, staff unemployed people capable of using a shovel to clear the srtreets, so dont bet your plan will work.

bikepawl

Because if you count money raised in Scotland - tax and oil revenue and subtract money spent in scotland then there is a net flow of money from Scotland to england

So whilst spending per capita is higher than the UK average ( but lower than the highest UK region) it is not at a cost to the English taxpayer.

Also I think his figures are out of date - under barnett the share of the UK CDP going to Scotland falls each year.

Wiki link
http://en.wikipedia.org/wiki/Barnett_formula

Scottish Nationalists have also pointed to what has been termed the Barnett squeeze.[12] They say that rather than protecting the favourable spending position of Scotland, that instead the Barnett formula is a method to steadily erode that advantage. They point out that if a 4% increase is needed in expenditure to cover inflation, Scotland will only get an increase of 3% of its total budget, whereas England will get the full 4% (proportional to population share). After inflation, this would mean a 1% budget reduction for the Scottish Executive.

b r - Member
...Each of my children at 16 will go and live there (and continue with their education)
...Any flaws in this?

You realise once they have lived in Scotland 3 years, they'll never want to go south of the border again.... 🙂

And they'll know that Spongebob is talking nonsense.

The oil belongs to the UK, not scotland, so theirs no revenue to grab

Ah! the oil revenue. Are there any other similar revenue streams generated down south to counteract the oil revenue? E.G Banking, motor manufacture.

I doubt that the Scottish fee system will be in place for anything like the long term

If the next Scottish government isn't formed by just the SNP then it's likely to be a coalition involving the LibDems again. Given the main concestion they gained from Labour last time they propped up their regime was to not have University fees, it'll be interesting to see what happens this time.

Means that Scotland puts in 8.3% and gets back 10%

Comparing apples and oranges I'm afraid - 8.3% is population, 10% was spending. If everyone in the UK generated the same amount of government revenue then it'd be correct, however in reality it's more complicated - especially because UK wide tax revenues get booked through London mostly. If you even pro-rated those across the UK then Scotland becomes a net contributer (and that was from the UK Labour government figures)

Bike pawl

Its the total tax take [i]in Scotland [/i] plus the oil revenue is greater than the total Scottish spending. No money raised south of the border is being counted

project - Member

The oil belongs to the UK, not scotland, so theirs no revenue to grab

this is simply factually incorrect. Teh north sea is divided in t 3 main zones - Norwegian, Scottish and English. Most of the poil is in the Scottish sector.

Absolutely cast iron and certain in law.

The oil belongs to the UK, not scotland, so theirs no revenue to grab

Doesn't have to be grabbed by Scotland - only pro-rated across the UK (i.e. not just counted as English tax income).

[i]Its the total tax take in Scotland plus the oil revenue is greater than the total Scottish spending. No money raised south of the border is being counted

project - Member

The oil belongs to the UK, not scotland, so theirs no revenue to grab
this is simply factually incorrect. Teh north sea is divided in t 3 main zones - Norwegian, Scottish and English. Most of the poil is in the Scottish sector.[/i]

I'm obviously under a misguided impression that back in 1707 England and Scotland came together to form a Union...

http://en.wikipedia.org/wiki/Acts_of_Union_1707

And this was due to the fact that Scotland had bankrupted itself - and needed 'saving':

http://en.wikipedia.org/wiki/Darien_scheme

So if we can have the cash (and interest) back, then you can clear off.

What a surprise - its gone OT.

Anyway back with the plan - not seen any one come up with an real objections yet?

To go back to your plan - I suspect you will have to tell a pack of lies in order for it to work.

So if we can have the cash (and interest) back, then you can clear off.

What a surprise - its gone OT.

As someone contemplating exploiting the Scots system right now for financial gain it is amusing to see you asking for money back

to the OP... yes there is a flaw... Scottish Uni fees will have (hopefully not) gone up by then.

[i]To go back to your plan - I suspect you will have to tell a pack of lies in order for it to work. [/i]

Lies? As long as the rules (made by the Government) are followed then no lies will be needed to be told.

But seriously this is really about ensuring that my children are not saddled with [b]vast[/b] debts that will then be 'sequestrated' from them for pretty much their entire working life. And since these debts will be in excess of £50k apiece and (if figures are to be believed) the average gross wage in the UK is less than half that, then [b]vast[/b] is the right word.

without an increase in income for scottish universites, which won't be coming from any govt in the short term at least, scottish universities can't remain fee-free for long.

if they do, they'll no longer become desirable universities to go to, because they'll be pants. i wonder how many scottish university principals [i]really[/i] believe that free education for scottish students (and in some ways EU students bar the english) is good for their universities in the long term.

another short sighted, vote grabbing SNP policy.

BR - if yor children are only living with their grandparents for a part of the year then I am not sure the rules will be being followed.

Poor troll.

another short sighted, vote grabbing SNP policy.

No fees in Scotland when the English ones were introduced was actually introduced by Labour and the LibDems (it being a LibDem policy).

Numbers to show how in the end, it'll still be the taxpayer involved - but a whole host of costs will have also been created (and profits made):

Grabbed from the Indy.

[i]Question: on average how much would someone have to earn per year to pay back their loan (predicted to be £33,879 for a 3 year course or £11,293 per year) after 30 years?

Answer: their average salary would have to be between £38,000-40,000 per year over the 30 year period.

If on average you earned £1,750 per month (£21,000 per year) you would pay £0 per month (£0 per year), so it wouldn't be repaid in 30 years (at this rate it would never be repaid).

If on average you earned £2,083 per month (£25,000 per year) you would pay £30 per month (£360 per year), so it wouldn't be repaid in 30 years (at this rate it would take 94 years to repay). After 30 years the graduate would have paid off £10,800 or about 32% of their loan.

If on average you earned £2,500 per month (£30,000 per year) you would pay £68 per month (£816 per year), so it wouldn't be repaid in 30 years (at this rate it would take 41.5 years to repay). After 30 years the graduate would have paid off £24,480 or about 72% of their loan.

If on average you earned £3,333 per month (£40,000 per year) you would pay £143 per month (£1,716 per year), so it would be repaid in under 20 years.

If on average you earned £4,167 per month (£50,000 per year) you would pay £218 per month (£2,616 per year), so it would be repaid in under 13 years.

If on average you earned £5,000 per month (£60,000 per year) you would pay £293 per month (£3,516 per year), so it would be repaid in under 10 years.

Question: if only 25% of students are going to be able to pay back their entire student loan then who is going to have to pay the outstanding loans for the 75% who won't earn enough to pay it back?

Answer: the taxpayer.

Question: how much will the taxpayer have to pay?

Answer: if there are 481,854 students, then 361,390 (75%) won't pay back their loans. If none of them contribute to their loan the cost to the taxpayer will be £12,243,531,810 (£12 billion). If they all earn £25,000 per year the cost to the taxpayer will be £8,325,601,631 (£8 billion). If they all earn £30,000 per year the cost to the taxpayer will be £3,428,188,907 (£3 billion).

Thus the taxpayer will have to pay between £3-12 billion per year to make up the shortfall.[/i]

And this is all in 'todays' money.

[i]BR - if yor children are only living with their grandparents for a part of the year then I am not sure the rules will be being followed. [/i]

What? Aren't you Scots allowed to leave the country, ever? From what I've seen, according to the 'rules' the eligibility is that you've lived in Scotland for the last three years, not that you are a Scot. I wonder how many 'Scots' are doing the same as I'm suggesting?