Student loans explained


#63

There isn’t any tax benefits to either? It’s a post tax deduction unfortunately


#64

Think this depends when you are, a lot of jobs outside London and outside the South East only have a degree as “desirable” from my experience


#65

Your right, i’m not sure why i was thinking otherwise.


#66

A flat tax though would not benefit those who want to pay it off, use less of a loan, get scholarships, or pay no tuition fees. That would be replacing one arguably broken system for another broken system. Whats the point?

It would seem to be that it would be better to make loans actually something you can realistically pay off. And perhaps there should be more things like scholarships, bursaries, good apprenticeships, etc. These are effective ways of gaining a degree and good career that many people take. You don’t need to be rich to pay of your loan.


(Jonathon) #67

But with a tax there would be nothing to pay off. They are simply paying more for a set period of time to pay back the country for funding their education that has in most cases led to them having a higher salary than those around them.

There wouldn’t be any need for scholarships for fees or anything like that.

The only way to realistically pay off your debt is to either have more time to do so or a higher amount. Both wouldn’t work.

The fact remains that even now, the amount paid domestically doesn’t cover the cost of the education they receive in many cases. International students, paying twice or more of the fees, cover the costs. Realistically fees should be higher.


(Peter Roberts) #68

With plan 1 loans it’s easily more effective to invest any extra funds you have as opposed to paying off the loan. Not sure about plan 2 but given it is written off I’d expect it is probably still true


(Jonathon) #69

I had a few friends do this, who could do.


#70

You’re advocating for a tax on everyone, that is a fee. Whats wrong with scholarships and apprenticeships? These fully fund someones education there’s no costs not covered.

You’re advocating for changing the system that arguably puts a burden on some people (having to pay some money for 30 years), to a system that puts a burden on everyone even if they could have paid off their own university tuition. And to cover the fees that tax would have to be higher to cover the loss from people who previously paid off their debts.

Scholarships and apprenticeships aren’t bad things, they are good things. Having the government just take it over and tax anyone going to uni just doesnt seem sensible.


(Jonathon) #71

At literally no point did I say scholarships are bad things. I give them out daily in my job so I wouldn’t ever say that.

But sorry… scholarships aren’t free. Someone pays for it. It’s free money for the student but it comes from somewhere.

I’m not saying 30 years is the best amount of time but the fact is that what we currently have is just a graduate tax that the richer people can pay off early. Most people, the vast majority, do not and can not pay back the full amount. I do not believe that it is unfair to ask those earning more to contribute more.


#72

I’m not either. I’m saying its paid for, not that its free. That’s the point of things like that, companies and other organisations regularly give out apprenticeships and scholarships. Rather than it being a government controlled tax on everyone.

Like I said this isnt universally true.

I think its a bit ridiculous. If we have to pay for other peoples education then we should get a say in what they can and cant do. Otherwise they can pay for their own education. More and more government control over things like this isnt always the right direction.


#73

Just out of interest, do you think that you should have a say in everything the government spends money on? What form do you think this should take?

(Not objecting to your statement, but curious as to the practicalities).


(Jonathon) #74

Yeah… I think we disagree fundementally on this one.


(James Waddington) #75

i didn’t know that interest rates also depended on income… and I’m currently a student! Just shows how much of a mess the system is


(Andy) #76

And that depends if you’re on a plan 1 or plan 2 loan. I’m on a plan 1 loan so my interest rate is set yearly and is flat for everyone however you’re likely on a plan 2 loan which is based on RPI and income

Plan 1 - http://www.studentloanrepayment.co.uk/portal/page?_pageid=93,6678642&_dad=portal&_schema=PORTAL
Plan 2 - http://www.studentloanrepayment.co.uk/portal/page?_pageid=93,6678755&_dad=portal&_schema=PORTAL


(James Waddington) #77

Yeah I’m plan 2, thanks for that! Just shows that the system is flawed, along with a “loan” that isn’t a loan, as in doesn’t affect your credit score


(Change Works) #78

There’s an interesting discussion of student finance here, for those who have half an hour to spare;


#79

Quite possibly :smile:

No, at least not directly, I’m not sure we are at a stage where we could make that transparent and viable enough without severe manipulation of the public, as much as it has its flaws we have our say by voting through for a representative to have a say on everyone on our behalf.

I don’t think it’s a simple issue though (the education one discussed). I should have been a bit more clear in what I said (for some reason I thought I was but it looks like I missed some clarification). Baseline education should be available to everyone regardless I think. I think that it’s a cornerstone for our society, regardless if it may have some flaws in it’s execution, anyone born here or who comes here should be able to have get a high school education for free.

(its maybe worth mentioning that state funded schools are told what they can and cannot teach, if you were going to do the same with uni I don’t see why it would be any different)

I think when it comes to education that you can choose or not choose to do then I’m not so sure the government should just add new additional tax on everyone and let everyone use it, at least not in the form that’s been mentioned here. Uni is optional. I think it’s should be accessible and affordable, but I don’t think the suggestion of a flat tax here is a good one.

I also don’t think it’s a simple problem and I think that doing he suggestion here of flat taxing anyone who goes to uni would diminish the options of going to uni in the UK. It’s essentially asking people who have succeeded better to pay for those who may not have for things that are optional. Why should someone who may have had a low debt from uni and are able to pay off their fees now pay more money for people who took out huge loans and took courses that would land them jobs that would never pay it off? All you’ll end up doing is having people get international scholarships etc. to take their education outside of the country and end up with an even larger uni loans debt than we have now. It’s a simple one solution fits all to a complex problem that requires multiple levels of solutions.

The system should be more accessible and more affordable (for everyone, loan applicants, and loan givers), loans should be better structured and made in a way that it can actually be paid off by more people. companies should have more incentives to offer full apprenticeships (giving full uni education, and/or trade qualifications) and companies, organisations, and trusts should be given more incentives to provide scholarships. A “community” based approach at minimum like that seems far better to me.


(Foxy) #80

I switched to DD last November, it was 5 days until my payday and it stopped straight away, nothing was taken out since October. Should be payed off my Christmas :slight_smile: