Are Students Loans That Unfair?

There’s been a lot of commentary about the rights and wrongs of the forthcoming student fee rises and the amounts that will have to be repaid. Many people complain about its unfairness.

In an ideal world most would agree that we should educate as many of our young people to as high a level as possible so that we can compete with the millions (literally) of new graduates coming out of places like India, China… well the rest of the world really. The big question is of course, who pays?

Delving into the past it would appear that many people, me included, received a free university education which we in turn are not willing to pass on to our children the truth however seems to be a bit different.

I was a student in 1977-78 and received a grant but if the taxation regime of then was in place now and I got a job paying £20000 pa I’d be taking home £1250 pm, a graduate today repaying their loan from an income of £20000 would be taking home £1292pm –£42pm more.

A similar sort of discrepancy exists for those earning £25000 they’ll be £52pm better off.

Arguably, the only unfairness about this was in the past when the 80-90% of families (including those earning less than £15000pa) whose children DIDN’T go to university had to pay that same level of tax for no obvious benefit.

This debate will run and run so please let us know what you think.

Should the EMA be scrapped or did it improve prospects?

The EMA was introduced to encourage those from low income families to remain at school longer and achieve better qualifications which in turn should improve employment prospects. However, there are those that believe that education is not only a right but a privilege. With millions of children stuck in poverty globally who live in desperate hope of a decent education, and wouldn't dare dream about being paid to attend school, should we be paying £0.5 Billion a year extra on our education bill? Whatever your views this is certainly a hot potato at the moment and we'd love to hear you views.....

Why do I need school fees planning advice?

Regardless of your financial situation there are always good reasons why you should plan your school fees payment. Eighty percent of parents pay their childrens' school fees directly from income. Whether the fees are readily affordable or not, this is unlikely to be the most efficient way to pay school fees. Whatever your circumstances are, the cost of school fees can be reduced.

In summary school fees planning advice will:

• Maximise your wealth by taking advantage of investment, pension and tax planning
• Make fees affordable by spreading the cost, minimising borrowing and maximising investment returns
• Ensure continuous education for your children
• Minimise inheritance tax through trust planning

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