There are a couple of extra things to factor in, the first of which being that the 21,000 threshold will increase year on year in line with inflation. So, if your salary only increases in line with inflation, you won't be paying any more; if it doesn't keep up with inflation, you'll be paying less.
Also, it's not clear whether the payments are subject to income tax relief - I'm guessing not, but I've not seen an official confirmation of that.
Not quite following your logic here. For starters taking the £40k example I'm assuming you've calculated £40k to be their career average but you've assumed that the £21k starting point is fixed.
No, no, no. You've given me far too much credit. I've simply calculated the figure based on a salary. A fixed, never-increasing salary. The real calculation will be quite complex. You might assume a starting salary of £21k then increase it by 5% per annum, or take an average salary.
I thought they were initially planning to review that starting point every five years but I think I heard that they're talking about reviewing it annually and raising it in line with inflation now.
And if they did the calculation is going to be more complicated.
As for your career £45k average. In todays money that would put them in the top 15% of earners - a statistic that emerged from the tories child tax credit reform. We're currently seeing about 35% of 18 year olds heading to universities. There aren't enough jobs in that bracket to support that number (not in this country anyway).
Having a well-educated work-force is always good. I'm struggling to know what to say other than that. I think we need to base more of our economy on world-class technology, construction and manufacturing. It's not good enough to make a Freeview box - ours has to be designed, and built, in the UK, and be the best. That, for example, is an area where we can be strong. Another area is broadband routers. Look at, for example, ARM http://www.arm.com/about/company-profile/index.php
Also advanced manufacturer - steel, plastics, carbon-fibre. Construction materials.
Your £90k example is pure madness. Who is going to run up a bill of £186k for three years tuition fees and lodgings?
I think you've misunderstood. That was 9% of salary - the stated repayment rate. I'm unclear myself whether you repay the, for example, £30k tuition fees, then stop, or whether you pay 9% for 30 years. My calculation is clearly 9% of the quoted salary for 30 years. Is that not what they are suggesting?
I know people who have earned more than £90k in a year.
I think you've misunderstood. That was 9% of salary - the stated repayment rate. I'm unclear myself whether you repay the, for example, £30k tuition fees, then stop, or whether you pay 9% for 30 years. My calculation is clearly 9% of the quoted salary for 30 years. Is that not what they are suggesting?
I know people who have earned more than £90k in a year.
No that would be a 9% graduate tax. The new system is 9% of salary above £21K until you've paid the loan off or 30 years elapses. Obviously someone on £90K will pay a higher repayment but pay the loan off long before 30 years is up.
There are a couple of extra things to factor in, the first of which being that the 21,000 threshold will increase year on year in line with inflation. So, if your salary only increases in line with inflation, you won't be paying any more; if it doesn't keep up with inflation, you'll be paying less.
Also, it's not clear whether the payments are subject to income tax relief - I'm guessing not, but I've not seen an official confirmation of that.
Regards,
Cypher
Crikey, looking at those figures you've got to wonder what all the fuss is about. It almost seems like the payments are progressive and help the poorest get through University.
I could be wrong, but all the evidence says it's progressive, yet the wild speculators keep saying it's not.
Crikey, looking at those figures you've got to wonder what all the fuss is about. It almost seems like the payments are progressive and help the poorest get through University.
I could be wrong, but all the evidence says it's progressive, yet the wild speculators keep saying it's not.
Exactly.
Some people could get a £27000 education for £10800.
No that would be a 9% graduate tax. The new system is 9% of salary above £21K until you've paid the loan off or 30 years elapses. Obviously someone on £90K will pay a higher repayment but pay the loan off long before 30 years is up.
That's right...it's like a mortgage. Presumably if you come in to some cash you can pay off the loan early with a lump sum. Not sure if there are any redemption penalties though (would be a bit mean if there were).
Some people could get a £27000 education for £10800.
And others, on still modest incomes, will pay full price. The point is should it cost £27.000 at all? Until yesterday it would cost £9,870. That's a staggering increase and massive shift in the burden from state to individual.
Why do supporters concentrate on the wonderful new repayment regime, ignoring utterly the fee increases?
As I understand it the fee does not have to be the top figure. I think any uni charging between 6k annually and 9k will have to justify the higher figure.
The fees for most subjects will provide the staff and support for the course now paid by HMG - so if you pay less you will even less education than now. If the standards are low the degree will be regarded accordingly.
You also have to add on living costs for three years. You also have to look at how many jobs require postgraduate qualifications - which add a further 1-4 years of fees to the bill. Your top performers, who would have had everything paid for 30 years ago, are now facing bills of nearly 100k to qualify with no certainty they can earn it back but repayments starting at a paltry 21k a year. You also kill any prospect of people without degrees getting them later in life or people retraining in different disciplines.
And others, on still modest incomes, will pay full price. The point is should it cost £27.000 at all? Until yesterday it would cost £9,870. That's a staggering increase and massive shift in the burden from state to individual.
Why do supporters concentrate on the wonderful new repayment regime, ignoring utterly the fee increases?
What exactly is your idea of a modest income then?
The median wage is £26000 which many working people don't even earn.
So exactly how many will be on those modest earnings of yours who will be crippled by debt.
Ok. So starting at £25k (well argue about that later), and with a 3% increase in salary every year, here is the 9% fee to pay each year, and accumulated payback.
nb. No interest calculation - disclaimer: interest will extend your repayment period, you home may be at risk if you do not keep up your payments, and will generally screw up your financial position.
In this example, assuming all the above, you would pay it off in year 12. Remember, interest hasn't been added yet, and this is only for £30k, and so won't include living costs (student loan).
Attendance at university is about 30 to 32 weeks a year giving students 20 - 22 weeks to earn money like my daughter did. She paid her own living expenses like many students do.
And others, on still modest incomes, will pay full price. The point is should it cost £27.000 at all? Until yesterday it would cost £9,870. That's a staggering increase and massive shift in the burden from state to individual.
Why do supporters concentrate on the wonderful new repayment regime, ignoring utterly the fee increases?
I suppose it's the reality of our national debt, more people going to uni, people living longer, strains on the NHS etc.
If you're going to invest in education I think a basic solid education is more important - haven't we lost ground against other countries in that respect?
Attendance at university is about 30 to 32 weeks a year giving students 20 - 22 weeks to earn money like my daughter did. She paid her own living expenses like many students do.
:eek::eek::eek::eek:
DON'T use my figures - I'm an IDIOT.
Got my figures wrong there - trying to be bl**dy clever.
Will re-do.
Because as a society we collectively have a responsibility to educate all children to a decent standard - GCSE/A Levels.
I personally don't think the state has a responsibility to educate a minority of 18 year olds to degree standard. Many will see further education as a means of benefiting themselves rather than enriching society.
The problem is too many people are going to university with no real benefit - jobs that previously required decent GCSEs now require degrees - ridiculous.
There's no logic in teaching one group and not the other at all. Many of the people who you educate to 16 or 18 will never get near to any standard and don't contribute much in terms of effort or taxes. You need highly educated people to make the country function and to pay most of the taxes. If you don't fund them they won't go or will go overseas and you will have more riots as the public schools take over even more of the top jobs.
If you argue education is valuable for everyone up to 18 there's no evidence at all that the marginal gain from 18-21 is any less worthwhile to the country than that from 16-18 or 14-18. Some would argue that, for many, University just restores standards to where they should be at leaving school.
There's no logic in teaching one group and not the other at all. Many of the people who you educate to 16 or 18 will never get near to any standard and don't contribute much in terms of effort or taxes. You need highly educated people to make the country function and to pay most of the taxes. If you don't fund them they won't go or will go overseas and you will have more riots as the public schools take over even more of the top jobs.
If you argue education is valuable for everyone up to 18 there's no evidence at all that the marginal gain from 18-21 is any less worthwhile to the country than that from 16-18 or 14-18. Some would argue that, for many, University just restores standards to where they should be at leaving school.
I think that the secondary education in this country, has been a problem for a while. It doesn't help with teachers having jobs for life.
If we can't rid ourselves of bad teachers, then the only hope is to pay for your kids to go private.
Ok. Last time I forgot to ONLY base fees on amounts over £21k. :rolleyes: (twit)
In this example it's based on starting at £25k and getting a 3% increase in salary every year. You can see the amount over £21k each year, the fee due on it, and the cummulative total. It would take 24 years to pay off £30k using this model.
Remember that £30k doesn't include any interest calculation, and might not include living cost loans either.
I think you've misunderstood. That was 9% of salary - the stated repayment rate. I'm unclear myself whether you repay the, for example, £30k tuition fees, then stop, or whether you pay 9% for 30 years. My calculation is clearly 9% of the quoted salary for 30 years. Is that not what they are suggesting?
I know people who have earned more than £90k in a year.
It's till the debt is paid or the time (30 years) elapses and the balance written off, whichever comes first.
I'm fairly confident that someone on a £40k salary (£806 a week) could budget around a £36 weekly bill.
I don't buy the often used arguement that students from poorer backgrounds would only focus on the £36 bill and be put off and wouldn't look at the £806 weekly gross income and have a lump in their trousers at the thought of such a wage.
£806 a week is way beyond me and Mrs Rustys joint weekly income and in the greater scheme of things we're managing ok. We're a typical two car two kids family with a mortgage. I don't think a student has the right to whinge about a potential £36 a week bill that corresponds to a wage packet far greater than what I support a family of 4 with.
I think they're either being:
a) bloody selfish or
b) played.
There is an option 'c' I suppose
c) thick
Tempting as it is to think that option c would win by listening to some of the mind numbingly stupid and iliterate comments that have sprung forth from a lot of the mouths of those students who choose to stand next to the roving tv reporters when asked to comment i'm prepared to give them the benefit of the doubt. I know they've been dunbing down education at secondary scholls over the years but jeez. They can't ALL be that thick surely.
One classic example appeared on Have I Got News For You
It went something like.....
"There's not many jobs out there and stuff. We can't be expected to be billed nine grand a year for three years education. That's like twenty one thousand !"
It's till the debt is paid or the time (30 years) elapses and the balance written off, whichever comes first.
I'm fairly confident that someone on a £40k salary (£806 a week) could budget around a £36 weekly bill.
I don't buy the often used arguement that students from poorer backgrounds would only focus on the £36 bill and be put off and wouldn't look at the £806 weekly gross income and have a lump in their trousers at the thought of such a wage.
Bless :D
just a little challenge to that (although I agree with the money being paid back to someone on 40k/year is a small amount), but someone on 40k, will have a take home pay of around £500/w after taxes and whatnot.
And others, on still modest incomes, will pay full price. The point is should it cost £27.000 at all? Until yesterday it would cost £9,870. That's a staggering increase and massive shift in the burden from state to individual.
Why do supporters concentrate on the wonderful new repayment regime, ignoring utterly the fee increases?
Because that is roughly what most of these degrees actually cost - just look at the market rates paid by international students. The £9,870 includes a roughly 50% subsidy by the Government and the HE institution. Arts students further subsidy STEM students.
Equally, it could be asked of opponents of the changes why do they concentrate on the impacton full time students, while ignoring that the injustice of part time students being forced to pay fees upfront is finally being addressed?
Anyway, for the earlier posters trying to calculate the effect of the changes, you're going to need the average annual graduate salary for year 0 - year 30 following graduation. The basic average figures used so far represent the whole spectrum of recent-past graduates whereras we want to model how much a graduate would pay as they climbed the career ladder.
You can then make fairly simple assumptions about inflation for the purposes of interest (at least until the new "real rate" mechanism is decided) and increasing the £21,000 limit. You'd then be able to work out in which year and how much it would cost overall for the average graduate to pay off an average loan (for the moment you could just do figures for £6,000/£9,000 fees etc.
Attendance at university is about 30 to 32 weeks a year giving students 20 - 22 weeks to earn money like my daughter did. She paid her own living expenses like many students do.
Which has nothing to do with the point jswift909 was trying to make - how long people will take to repay the loan. That happens after graduation. Few students will earn enough while studying to actually begin to pay their loan off.
The idea students earn enough to live on is rather fanciful. The maintenance loan just about covers rent, but on top of that they have books to buy. Then there's food and utility bills. They might earn enough to pay for extras like drinks, nights out, phones, etc.
While this is undoubtedly true, putting the genie back in the bottle will prove difficult, as the traditional ways for people to qualify by non-degree routes have all disappeared.
Aren't BTEC, C&G, NVQ's still available?
Then there are commercial certifications, CCNA, CCNP, MCSE, MCAD, PRINCE2, CompTIA, etc.
Comments
Good work, jswift909 - that looks about right.
There are a couple of extra things to factor in, the first of which being that the 21,000 threshold will increase year on year in line with inflation. So, if your salary only increases in line with inflation, you won't be paying any more; if it doesn't keep up with inflation, you'll be paying less.
Also, it's not clear whether the payments are subject to income tax relief - I'm guessing not, but I've not seen an official confirmation of that.
Regards,
Cypher
And if they did the calculation is going to be more complicated.
Having a well-educated work-force is always good. I'm struggling to know what to say other than that. I think we need to base more of our economy on world-class technology, construction and manufacturing. It's not good enough to make a Freeview box - ours has to be designed, and built, in the UK, and be the best. That, for example, is an area where we can be strong. Another area is broadband routers. Look at, for example, ARM http://www.arm.com/about/company-profile/index.php
Also advanced manufacturer - steel, plastics, carbon-fibre. Construction materials.
I think you've misunderstood. That was 9% of salary - the stated repayment rate. I'm unclear myself whether you repay the, for example, £30k tuition fees, then stop, or whether you pay 9% for 30 years. My calculation is clearly 9% of the quoted salary for 30 years. Is that not what they are suggesting?
I know people who have earned more than £90k in a year.
Crikey, looking at those figures you've got to wonder what all the fuss is about. It almost seems like the payments are progressive and help the poorest get through University.
I could be wrong, but all the evidence says it's progressive, yet the wild speculators keep saying it's not.
Exactly.
Some people could get a £27000 education for £10800.
Doesn't that mean that the system will be loosing money ???
Now I'm really confused
That's right...it's like a mortgage. Presumably if you come in to some cash you can pay off the loan early with a lump sum. Not sure if there are any redemption penalties though (would be a bit mean if there were).
Why do supporters concentrate on the wonderful new repayment regime, ignoring utterly the fee increases?
The fees for most subjects will provide the staff and support for the course now paid by HMG - so if you pay less you will even less education than now. If the standards are low the degree will be regarded accordingly.
You also have to add on living costs for three years. You also have to look at how many jobs require postgraduate qualifications - which add a further 1-4 years of fees to the bill. Your top performers, who would have had everything paid for 30 years ago, are now facing bills of nearly 100k to qualify with no certainty they can earn it back but repayments starting at a paltry 21k a year. You also kill any prospect of people without degrees getting them later in life or people retraining in different disciplines.
Yes the government has already said that there will be losses. About 25% could pay little or nothing.
What exactly is your idea of a modest income then?
The median wage is £26000 which many working people don't even earn.
So exactly how many will be on those modest earnings of yours who will be crippled by debt.
Figures or other evidence please.
Attendance at university is about 30 to 32 weeks a year giving students 20 - 22 weeks to earn money like my daughter did. She paid her own living expenses like many students do.
I suppose it's the reality of our national debt, more people going to uni, people living longer, strains on the NHS etc.
If you're going to invest in education I think a basic solid education is more important - haven't we lost ground against other countries in that respect?
:eek::eek::eek::eek:
DON'T use my figures - I'm an IDIOT.
Got my figures wrong there - trying to be bl**dy clever.
Will re-do.
OK - it's good that you are trying to provide figures unlike some who make ludicrous comments based on no evidence at.:)
There's no logic in teaching one group and not the other at all. Many of the people who you educate to 16 or 18 will never get near to any standard and don't contribute much in terms of effort or taxes. You need highly educated people to make the country function and to pay most of the taxes. If you don't fund them they won't go or will go overseas and you will have more riots as the public schools take over even more of the top jobs.
If you argue education is valuable for everyone up to 18 there's no evidence at all that the marginal gain from 18-21 is any less worthwhile to the country than that from 16-18 or 14-18. Some would argue that, for many, University just restores standards to where they should be at leaving school.
I think that the secondary education in this country, has been a problem for a while. It doesn't help with teachers having jobs for life.
If we can't rid ourselves of bad teachers, then the only hope is to pay for your kids to go private.
Is that national median wage or national median graduate wage?
In this example it's based on starting at £25k and getting a 3% increase in salary every year. You can see the amount over £21k each year, the fee due on it, and the cummulative total. It would take 24 years to pay off £30k using this model.
Remember that £30k doesn't include any interest calculation, and might not include living cost loans either.
It's till the debt is paid or the time (30 years) elapses and the balance written off, whichever comes first.
I'm fairly confident that someone on a £40k salary (£806 a week) could budget around a £36 weekly bill.
I don't buy the often used arguement that students from poorer backgrounds would only focus on the £36 bill and be put off and wouldn't look at the £806 weekly gross income and have a lump in their trousers at the thought of such a wage.
£806 a week is way beyond me and Mrs Rustys joint weekly income and in the greater scheme of things we're managing ok. We're a typical two car two kids family with a mortgage. I don't think a student has the right to whinge about a potential £36 a week bill that corresponds to a wage packet far greater than what I support a family of 4 with.
I think they're either being:
a) bloody selfish or
b) played.
There is an option 'c' I suppose
c) thick
Tempting as it is to think that option c would win by listening to some of the mind numbingly stupid and iliterate comments that have sprung forth from a lot of the mouths of those students who choose to stand next to the roving tv reporters when asked to comment i'm prepared to give them the benefit of the doubt. I know they've been dunbing down education at secondary scholls over the years but jeez. They can't ALL be that thick surely.
One classic example appeared on Have I Got News For You
It went something like.....
"There's not many jobs out there and stuff. We can't be expected to be billed nine grand a year for three years education. That's like twenty one thousand !"
Bless
just a little challenge to that (although I agree with the money being paid back to someone on 40k/year is a small amount), but someone on 40k, will have a take home pay of around £500/w after taxes and whatnot.
Equally, it could be asked of opponents of the changes why do they concentrate on the impacton full time students, while ignoring that the injustice of part time students being forced to pay fees upfront is finally being addressed?
Anyway, for the earlier posters trying to calculate the effect of the changes, you're going to need the average annual graduate salary for year 0 - year 30 following graduation. The basic average figures used so far represent the whole spectrum of recent-past graduates whereras we want to model how much a graduate would pay as they climbed the career ladder.
You can then make fairly simple assumptions about inflation for the purposes of interest (at least until the new "real rate" mechanism is decided) and increasing the £21,000 limit. You'd then be able to work out in which year and how much it would cost overall for the average graduate to pay off an average loan (for the moment you could just do figures for £6,000/£9,000 fees etc.
The idea students earn enough to live on is rather fanciful. The maintenance loan just about covers rent, but on top of that they have books to buy. Then there's food and utility bills. They might earn enough to pay for extras like drinks, nights out, phones, etc.
Aren't BTEC, C&G, NVQ's still available?
Then there are commercial certifications, CCNA, CCNP, MCSE, MCAD, PRINCE2, CompTIA, etc.