"Prime Minister Helen Clark and Education Minister Trevor Mallard today announced the second of Labour’s key election pledges: no further interest will be charged for those with student loans who reside in New Zealand."
From April next year if labour gets in...
I think it's awesome, but can't help whinging that it doesn't actually help me. For all that it's going to make it easier for future students, ultimately good for NZ yada yada, what do i do with the $5000 interest I've already accrued since leaving uni? I've been a good kiwi and stayed in NZ and worked my arse off to knock about $50 off the prinicpal of my loan. Why can't it be retrospective Helen?! (I'm stamping my feet about now).
How do other people feel about it, will it cement a Labour vote?
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yeah, typical - it'll come in about ...
yeah, typical - it'll come in about two months after I make my last repayment.
and what I don't get is how people aren't going to (ab)use the system to take out huge loans so they've got no-interest cash to invest with. bloody hell, I'm tempted to enrol in a few courses next year so I can repay my credit cards. 0% v. 18% is pretty appealing.
//and what I don't get is how people ...
//and what I don't get is how people aren't going to (ab)use the system to take out huge loans so they've got no-interest cash to invest with. bloody hell,
Well isn't the most you can get is your course fees, plus the $1000 plus $150 a week living costs? I mean, it's not like in the olden days when you could call up and there'd be money in your account the next day is it?
has anyone ever been prosecuted for ...
has anyone ever been prosecuted for student loan fraud?
wasn't there an outfit in taranaki (?) ...
wasn't there an outfit in taranaki (?) which had a course built pretty much around enabling its 'students' to get a computer?
Ah yes, here it is. 11 students prosecuted.
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// Well isn't the most you can get is ...
// Well isn't the most you can get is your course fees
I'll be doing dentistry. And maybe take that pilot's course too.
...and don't the course fees get paid ...
...and don't the course fees get paid straight to the university?
Yes. And if you drop a paper, the ...
Yes. And if you drop a paper, the refund goes back off your student loan, not to cash.
bah! my brilliant scheme is thwarted....
bah! my brilliant scheme is thwarted.
//I'll be doing dentistry. And maybe ...
//I'll be doing dentistry. And maybe take that pilot's course too.
The key is to take the cheapest possible, but still full-time, course. Then claim living costs+course-related costs. Simply let yourself fail the papers (there is eventually a limit on how many papers you can fail). You may not be eligible for living costs. Unfortunately, I suspect the cost of the failed course would make interest look pretty minor. OTH, you may be able to enrol and withdraw with full refund and get course-related costs of $1000 or so, in which case it wouldn't be so bad....
noizy, i'm no banker, but what i ...
noizy, i'm no banker, but what i don't get is wouldn't it make more economic sense to pay off your 18% interest credit cards before you pay off your 13% interest student loan,
How does National's policy look now, ...
How does National's policy look now, given their continual grandstanding over how they are the only party who cares about the brain drain?
Even more so given their likely removal or relaxation of University fee caps, thus negating any effect via rebate. Whatever your political persuasion, it's a very shrewd and well-timed announcement in terms of strategy.
It Looks no worse than their shambles ...
It Looks no worse than their shambles re: Child Care.
Another obervation Jimi, did Leif Garrett inheirate Peter Framptons locks?
Forget the brain drain, the NZ ...
Forget the brain drain, the NZ Herald's worried about the sperm drain...
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"If you are a 34-year-old heterosexual ...
"If you are a 34-year-old heterosexual woman in New Zealand you have as much chance of finding a male partner your own age as does an 85-year-old woman," Salt said.
(gasp!) Not often I read shock stats directed square at me...
meh. I knew there was a good use for the global disco that is the internet.
//meh. I knew there was a good use for ...
//meh. I knew there was a good use for the global disco that is the internet. meh.
You want me to start a "Who Wants To Marry a Heather?" thread?
Aw, cheers, but I have a hunch you'd ...
Aw, cheers, but I have a hunch you'd just end up with a bunch of applications from 21-year-olds living in the 'burbs. No offence to any 21-year-olds in the 'burbs, mind..also trolls.
//I have a hunch you'd just end up ...
//I have a hunch you'd just end up with a bunch of applications from 21-year-olds living in the 'burbs
Duh! What do you think the point would be? Dammit, now i'm going to have to build a gingerbread house instead.
I do hope Labour wins this election. I ...
I do hope Labour wins this election. I do wish I could vote.
Motherfuckers. I have $400 left to pay ...
Motherfuckers. I have $400 left to pay on my loan. Fat lot of help the government were when I needed them
*sob sob sob*
you do however have the satisfaction of ...
you do however have the satisfaction of knowing you did it all yourself. i think that's pretty cool.
A government finally makes the step ...
A government finally makes the step (even if it was elecction year, shame on them) and all people can do is think of their own hardships and whinge about policy of previous governments
All I have to say of this policy is It's About Time.
here here...
here here
i think it's quite a nice balance ...
i think it's quite a nice balance between the current system (which isn't really working) and the Greens etc. plan of free tertiary education. . . the cost is still a deterrent to time wasters/professional students , but the repayments aren't quite so crippling.
its a big difference, because with out the interest you can make a much bigger dent in it in your first couple of years out of uni - presently if your loan is large enough, there's a point where your interest is higher than the amount it is possible to repay back - unless you strike paydirt - and the debt keeps growing...
I'm very happy about this, but I'm ...
I'm very happy about this, but I'm always skeptical about government promises.
If they do pull through on this one, its perfect timing for my and my $27000 5-year degree debt. I've been really worried about the fact the interest meant it would take me a bloody long time to pay back, now, if labour win, and do what they say, I'll only have to worry about that amount, not a whole lot more.
Paying off the loan is the biggest priority when I get a job, and I want to stay in NZ for a while, so this policy lures people like me perfectly.
Plus as the kind of person who would like to buy my own house once I have some cash this takes the burden off things like that too... the whole student loan interest thing is like an albatross hung around the neck of all students at present, preventing them from doing more things with their lives, like owning their first house.
So will this change in the student loan ...
So will this change in the student loan policy start to put a hamper in the good old kiwi OE? Certainly students (or recent graduates) will think twice about heading overseas for a working holiday (or just extended holiday) if all of a sudden when they do they have pay large amounts of interest?
So aside from being good for students will it restrict people who want to do their OE?
Thoughts?
//if all of a sudden when they do they ...
//if all of a sudden when they do they have pay large amounts of interest?
Umm, they've always had to pay interest on their loans, haven't they?
That's the idea, isn't it? To ...
That's the idea, isn't it? To counter the brain drain?
// That's the idea, isn't it? To ...
// That's the idea, isn't it? To counter the brain drain?
I'm not talking about people who are moving overseas permanatly - I'm talking about people who opt to go over for say 6 months or a year on a 'working holiday'.
Ahhhh forget it...
Brain Drain isn't necessarily the same ...
Brain Drain isn't necessarily the same as thing OE. There are some kiwis overseas who we might be better off without...
// I'm talking about people who opt ...
// I'm talking about people who opt to go over for say 6 months or a year on a 'working holiday'.
I don't think 6 months of normal interest on a student loan will be any impediment to people wanting to do that sort of OE.
And, equally, people who want to go overseas on a longer-term basis will continue to do so anyway - the higher overseas wages will offset any gains they might have made by staying in NZ and repaying the interest-free loan that way.
Noizyboy is right on both counts. It ...
Noizyboy is right on both counts. It won't stop the brain drain, and who is it really helping. Only higher wages in NZ will do that.
I've never thought that being too easy on people will help them help themselves.
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Too easy! ...
Too easy! ahahahahahahahahahahahahahahaha
//and who is it really helping. it ...
//and who is it really helping.
it will help me and most of the people I went to varsity with and most of the people I have ever flatted with. I haven't been a student since 1997 and I'm not really in the "youth vote" bracket but I still have a significant outstanding loan debt and this policy will help me significantly
//being too easy on people
um, what?
Are they wiping the entire interest ...
Are they wiping the entire interest rate, or just the base rate? That is, will the loan still increase with the CPI? Not that I'm complaining either way, just curious.
// Are they wiping the entire interest ...
// Are they wiping the entire interest rate, or just the base rate?
It would appear they're scrapping interest entirely.
"Under Labour, from 1 April next year, no interest will accrue on student loans. And from that point, students who borrow will only pay back what they have borrowed."
...
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Pretty sure no interest whatsoever, as ...
Pretty sure no interest whatsoever, as indicated by the flat curve on the link here. You'll also see the alarming shape of a traditional student loan/mortgage curve; where it literally takes in excess of 10 years to make any headway on paying back principal. It's really *quite* terrifying.
Like others have already mentioned, I don't think this will impact too much on going on an OE, a couple of years of interest is kind of bad, but it's the interest across 20 years that is a killer. I was initially a bit wary of this scheme, but I think it's a winner. In some ways, it is rather more like a universal allowance, but with a small retrospective tax premium for those who go to university. That is, although it will still wear the name "student loan", it's probably better conceived as an allowance. It's certainly far more friendly than the Nat's model, which, no surprises, benefits big money earners.
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is it just me or does that loan ...
is it just me or does that loan calculator simply not work on a mac.
And is it just me or can you not ...
And is it just me or can you not determine how fast you want to pay it back? Does it just assume the minimum?
When I pay my loan off my tax bill will ...
When I pay my loan off my tax bill will be quite a bit less. Is that not incentive enough?
Also, can you please give me some examples of how a student might borrow more money?
thanks=thinks...
thanks=thinks
Students will be borowing more because ...
Students will be borowing more because of this, increasing debt. I'ts not that hard to find part time work, and full time holiday work. I've finished but I have no loan. God knows why anyone outside of medicine needs to have such massive loans.
okay, i'll bite. // God knows why ...
okay, i'll bite.
// God knows why anyone outside of medicine needs to have such massive loans.
wtf??
do you live at home rdor?...
do you live at home rdor?
//Students will be borowing more ...
//Students will be borowing more because of this, increasing debt.
the only students borrowing more will be the ones that belong to one or more of the following
- don't borrow their full entitlement already
- aren't already students
- stay at varsity longer than they would have if they had to pay interest
- change to more expensive papers
I just think people should take ...
I just think people should take responsibility for the loans that they take out, and that making student loans interest free won't help that. rdor is right, (though not about just the medicine students). It will increase student and government debt, and student dependency on the government.
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//I just think people should take ...
//I just think people should take responsibility for the loans that they take out, and that making student loans interest free won't help that
that's a fairly nebulous statement. Do I take it you mean people should think twice about attending university if they need a student loan to afford the fees? Or do you mean people should be more serious about paying back their loans once they complete their education?
here's one situation for you rdor, ...
here's one situation for you rdor, since you can't conceive why someone might actually need a student loan:
let's say I'm in the 7th form at St Kevins in Oamaru. Next year I'm planning on doing law at Otago. My parents both work at the freezing works and are donating half my accomodation at one of the halls of residence. My student loan and my summer job on my uncle's farm will be enough to take care of the rest.
//I just think people should take ...
//I just think people should take responsibility for the loans that they take out, and that making student loans interest free won't help that.
If you define "taking responsibility" for the loans as paying them off (which is after all what "responsible" people do), then it making them interest free will actually make it likely that they will pay them off.
This policy will not increase government debt. The current student loan debt is already classified that way, and all the interest and principal on the loans that is currently not being paid off (and much of which, there isn't a shit show in hell of being paid off) is expanding at an ever increasing rate. While it is likely that students will borrow more, more debt will be paid off (admittedly because the government will foot the interest bill, but the government is footing the interest bill on the current loan debt that's not being paid off anyway. it's a a zero-sum game).
And sure, some students are going to milk the system. But a proportion of people have always been milking the system. Hell, I know a bunch of Nat voters who back in lump sum days confidently drew down their max entitlement because they thought labour would wipe their loans. Man were they bitter when Winston First went with National. They tried the same thing in 1999, thinking it might work that time...
From my perspective, the merit of the current proposal is that it will help the genuinely needy. I'm sure everyone who has been at university knows at least one person whose parents are rather well-off, but has their income 'hidden', so the kid gets an allowance from the government, a 40,000 car from mum & dad. This proposal is a nice compromise between a genuinely free education, and the present system. People will still have to pay for a proportion of their education, but they'll at least be able to pay it off in a timely fashion.
//Do I take it you mean people should ...
//Do I take it you mean people should think twice about attending university if they need a student loan to afford the fees?
No, that's not what I mean. However, if you are going to invest in your future, it's gotta come with some hardwork doesn't it? Maybe the "interest free" bit should come with some terms - i.e pass all papers, not making a career out of studying (max 5 years borrowing or something), or only interest free if you pay off a certain amount every year...
I'm just saying that I'm quite happy to pay interest on my loan, because it is my responsibility to have taken it out as an investment in my future... although perhaps I'm lucky because I worked a part-time job while I was studying, so only had a loan for half the time I was studying.
//Or do you mean people should be more serious about paying back their loans once they complete their education?
Yes, that is closer to what I mean.
[ http://www.therockfactory.net ]