Convincing you to go to University despite the massive cost: Apparently it's a 'no-brainer' despite the cost because over your lifetime you'll earn on average 150k more because of your degree.
Convincing you not to worry about the fees: Don't worry, you have to earn over 21k before you start paying and the loan is written off after 30 years - so many won't pay anything, or won't have to pay it all back...
So which is it? We shouldn't worry because we'll earn a lot more over our lifetime and it will be worthwhile, or we shouldn't worry because we'll probably never earn enough to have to pay it back!!!!
Some simple Maths: from Day 1 your loan attracts interest of RPI + 3%' so 7.5% at present. That is compounded up during your studies as you add more debt, and the interest incurs further interest. In rough terms an average 3 year degree will have created a debt of around 50k, interest on that will amount to a further 3.75k added to the debt at the end of your first year after leaving. Earn (for the sake of argument) 50k as a result of your degree and you will pay back 9% of 29k over the year - around 2.7k, Your effective marginal tax rate is nearly 50% on income over 35k(a rate you'd otherwise need to earn over £150k before paying) - and your loan debt has still grown, so you end up the year owing more than at the start!
All in all it is a financial car crash, reminiscent of something dreamt up by the geniuses that brought us endowment mortgages. Once again it looks like a vehicle for the money men to cream off from the rest of us - parents and students - and exactly the sort of nonsense Government should protect us from instead of inflicting upon us.
