Student loans really were mis-sold 1

Student loans really were mis-sold

I’ve three youngsters, all of whom went through college below particular student mortgage regimes; the final one started college in 2012, simply as the expenses went up to £nine,000. I used to support the pupil loan device, as I figured it was now not an actual debt, being written off after 30 years and simplest payable on a sliding scale of earnings. In this appreciation, I was out of line with the rest of my family and buddies, who all seemed obsessed with the concept that Nick Clegg and the Lib Dems had done a U-switch on this. I agreed with Vince Cable, who defended the flow sensibly to fund a hugely extended better education system.

Then, after my daughter had already clocked up a time period’s well worth of mortgage, I used to be alerted to the excessive interest price payable on the £9,000. She’d be paying RPI plus three% while she was reading and at least RPI after that, more if she earned greater. I was appalled by using this, and because we have the assets, we paid off her mortgage and after that funded her studies ourselves.

(It interested me not a touch, too, to listen that my pension, one of the public zone ones sometimes jealously known as “gold plated†as it turned into related to inflation, could be switching from RPI to CPI because it became a more accurate measure of inflation – or so the pension scheme humans instructed me!)

I did an intensive search of a newspaper database which protected all uk newspapers at the time to look how a lot of exposure turned into given to the interest price hike: 99% of the media coverage had focused on the walk to £9,000, absolutely overwhelming the occasional mention of a better hobby charge.
Student loans really were mis-sold 2
Around the same time, as a university professor, I used to be asked to speak to sixth-formers in a local London faculty about applying to university. Earlier than my communication, I heard the faculty’s co-ordinator of 6th-shape research inform a group of approximately 60 to 70 students that they needn’t worry approximately eliminating a loan, because the hobby rate on it was so low, and anyway you didn’t have to pay it lowers back if you couldn’t come up with the money for it. Her original purpose was manifestly to get her college students to better training: what instructor would now not need this?

On the stop of the afternoon, I informed her that she turned into incorrect about the interest rate, and they were duly greatly surprised to comprehend that she had now not recognized approximately it. I don’t recognize if she then disabused her pupils of the false statistics she had just given them. I’m hoping so.


I am a writer, financial consultant, husband, father, and avid surfer. I am also a long-time entrepreneur, investor, and trader. For almost two decades, I have worked in the financial sector, and now I focus on making money through investing in stock trading.