_w_ Posted September 9, 2011 Share Posted September 9, 2011 of course - it is a transfer of wealth from the rich to the poor, that's the point I don't understand. I see this as a transfer of wealth from students to lenders. Quote Link to comment Share on other sites More sharing options...
Terribad Posted September 9, 2011 Share Posted September 9, 2011 How big is the penalty? I have 12k student debt, have enough saved to pay it off, and didn't realise I would get fined for saving :angry: Quote Link to comment Share on other sites More sharing options...
Injin Posted September 9, 2011 Share Posted September 9, 2011 I don't understand. I see this as a transfer of wealth from students to lenders. Nah. By the time all the payments have been made, the lenders will gain money but lose wealth. The reason for student debts is because they can be put on the asset side of the balance sheet, supporting the current crazy leverage. Paying off removes them from the asset side. Quote Link to comment Share on other sites More sharing options...
_w_ Posted September 9, 2011 Share Posted September 9, 2011 Nah. By the time all the payments have been made, the lenders will gain money but lose wealth. They never put any wealth in in the first place. Quote Link to comment Share on other sites More sharing options...
Si1 Posted September 9, 2011 Share Posted September 9, 2011 I don't understand. I see this as a transfer of wealth from students to lenders. it's a progressive tax - if you end up on a low salary you don't pay it back, so students who end up in low paying jobs don't pay much if any - aka the poor are subsidised by the rich Quote Link to comment Share on other sites More sharing options...
Tiger Woods? Posted September 9, 2011 Share Posted September 9, 2011 it's a progressive tax - if you end up on a low salary you don't pay it back, so students who end up in low paying jobs don't pay much if any - aka the poor are subsidised by the rich Good Lord...you've completely missed the subtlety. It punishes the middle, leaving the top and bottom to get off more lightly. In most circumstances this is a 9% marginal increase in an individual's tax rate for 30 years for attending higher education. The only way out of this is to earn (more or less) nothing, or earn so much early on in your career that the amount owed shrinks rather than grows. Quote Link to comment Share on other sites More sharing options...
PopGun Posted September 9, 2011 Share Posted September 9, 2011 Good Lord...you've completely missed the subtlety. It punishes the middle, leaving the top and bottom to get off more lightly. In most circumstances this is a 9% marginal increase in an individual's tax rate for 30 years for attending higher education. The only way out of this is to earn (more or less) nothing, or earn so much early on in your career that the amount owed shrinks rather than grows. This Quote Link to comment Share on other sites More sharing options...
SarahBell Posted September 9, 2011 Share Posted September 9, 2011 I know someone who repaid their student loans last year - got letters confirming the account was now paid. Letter came in from student loans yesterday giving details of the direct debit payments they were going to take this year -- and enclosing a statement showing a nil balance of debt. These companies could not be more inefficient it they tried. You've really not had much experience of councils have you? Quote Link to comment Share on other sites More sharing options...
PopGun Posted September 9, 2011 Share Posted September 9, 2011 You've really not had much experience of councils have you? Or the tax office. Quote Link to comment Share on other sites More sharing options...
scottbeard Posted September 9, 2011 Share Posted September 9, 2011 I seriously think with how FUBAR things now are the best answer is to produce kids, lots of kids, then let the state provide. The state will not be willing or able to provide for people like that in times to come. It's like people who say "i'm not saving for retirement - i'll spend spend spend and let the state support me." Nice plan - but only if the state is still doing it in 30 years, which they won't be (at decent levels anyway) Quote Link to comment Share on other sites More sharing options...
Lepista Posted September 9, 2011 Share Posted September 9, 2011 The state will not be willing or able to provide for people like that in times to come. It's like people who say "i'm not saving for retirement - i'll spend spend spend and let the state support me." Nice plan - but only if the state is still doing it in 30 years, which they won't be (at decent levels anyway) But then in 30 years time, you'll have lots of kids who are able to support you. Quote Link to comment Share on other sites More sharing options...
Terribad Posted September 9, 2011 Share Posted September 9, 2011 Wait wait wait, the charge will only be for mega-earners (60k+), and won't affect those mere mortals being prudent with realistic wages. Quote Link to comment Share on other sites More sharing options...
Injin Posted September 9, 2011 Share Posted September 9, 2011 Wait wait wait, the charge will only be for mega-earners (60k+), and won't affect those mere mortals being prudent with realistic wages. Given the rate of inflation, how soon will 60k be peanuts? Answers on a postcard (bought in 1980 for 3pence) to..... Quote Link to comment Share on other sites More sharing options...
Si1 Posted September 9, 2011 Share Posted September 9, 2011 Good Lord...you've completely missed the subtlety. It punishes the middle, leaving the top and bottom to get off more lightly. In most circumstances this is a 9% marginal increase in an individual's tax rate for 30 years for attending higher education. The only way out of this is to earn (more or less) nothing, or earn so much early on in your career that the amount owed shrinks rather than grows. other way out is to use salary sacrifice to protect wealth via pension investments - this is employment not tax law so is a haven as to the rich having loopholes - I understand this may be the case and disagree with it but iot still doesn't take away from the fact that this is not debt in the true sense of the word - there is no risk that under circumstances of low income at somepoint in your life you are going to lose everything for it, it has a very very soft edge Quote Link to comment Share on other sites More sharing options...
tim123 Posted September 9, 2011 Share Posted September 9, 2011 There is virtually no risk when the debt can't be discharged in bankruptcy and the law backs your claim over anything else. No risk. Early repayment reduce the value of loans to lenders / bondholders. That's a fact. The remaining debt will be written off if not repaid in 30 years. AIUI the repayments are such that even someone with an average graduate salary progression will not repay the debt, only the really high flyers will do so. Quote Link to comment Share on other sites More sharing options...
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