Student Debt Loan is Rising, and What to Do About it

In the UK, where the government contributes substantial funding to education, a drastic cut to the public sector is occurring. The move will raise the cost of a degree substantially, saddling current students with higher debt levels and pricing out future generations. The government face of this change argues that with less involvement, universities will be more flexible and responsive to student needs. They will also have the chance to earn more money for themselves, which the government further argues puts them in a position to use those resources better.

Student advocates argue that no real qualitative increase can occur. Without funding, universities must shift costs onto students to cover those deficits and continue operation. That means less money spent on research and student development, and more spent on infrastructure.

It’s a troubling situation, and students are going to have to learn to live with it as time goes on.

Government Funding of Education

The exact costs that the government subsidized covered things like teachers, research grants and materials for students. This advantage was for UK residents only, so foreigners probably don’t notice the change, except perhaps the quality of the education they are eligible to receive. These new cuts will ultimately remove up to 90% of the total state contributions. That means staff cuts and asset liquidation that is already occurring in universities across England may see the pace increased to cut costs quick enough.

All of this comes on the heels of budget cuts that have been occurring since 2009 that have already cut the amount spent on teachers by 80%. That’s a massive blow to a university system that was largely publicly funded.

How Universities are Affected

Obviously, tuition must be raised, and indeed this is already occurring. Today’s 20 year-old faces some of the steepest tuition rates in UK history, and most shoulder the burden largely by him or herself. This student must borrow this money at higher interest rates than his or her parents did, and will likely have to work through schooling to pay it off.

Larger universities, like Cambridge and Oxford, feel okay with the changes. This is because they are highly valued institutions with a good name, and will continue to attract applicants from all over the world. The question is not whether the candidates will be there, but will those candidates continue to contribute to the university’s standards of education.

It is smaller universities that may feel the pinch as the cost of a degree goes up. Budget universities may also spring up so students have an affordable alternative, but the message is clear: if you can’t afford to attend a reputable university, there is no longer a safety blanket to help you.

Tips for Paying Loans

So what is the student left with, after all is said and done?

SettleMyDebt recommends that you negotiate your loan payments and work out a better payment structure. They can help you set up a consolidation program to pay down multiple debts with one payment.

The government still works with students to set them in apprenticeships. Like an internship, becoming an apprentice equips you with a practical skill you can use to earn a decent wage in school. Put a small percentage of your earnings toward your loans to pay down that amount with minimal interest

Moving is also viable alternative. Tuition fees may be cheaper in Scotland or Wales, and students in Scotland are more likely to attend a four-year university. The combination of lower tuition and less time spent in school means lower costs overall.

Tags: debt, student loans

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