A student speaks

In a few months time I will graduate from university, and, like thousands of fellow students, enter the dreaded world of work. I'm preparing for this shock to the system with a stint on Times Money.  But unlike thousands of fellow students, I will leave the campus with an account balance still in the black, and without a student loan bill in sight. Yes, I’m one of those rare birds, a debt-free graduate.

I’ve been fortunate that grandparental investments conveniently paid for my tuition fees, and monthly parental cash jabs kept my current account alive. Endless hours of part-time work and a lifestyle that was most of the time, well, pretty prudent and penny-pinching, take the credit for the rest. 

I had this weird idea not to get into debt while at university – my very own ‘golden rule’, if you like – and somehow I managed to stick to it. My flat was small and shabby, my shopping done at the discount shelves of huge supermarkets. I chose walking over the bus and tap water over wine.

Give or take the odd worry that I might have missed out on things during the “best days of my life”, it’s great to start your working life without owing a single penny, especially because, according to the annual Barclay’s survey, the average student is now graduating with a debt pile of £13,501.

Surely, I’m set for a smooth financial future?

I doubt it. A combination of luck, fortune and self-restriction made staying debtless work out during my student days. But the real trouble, I figure, is just about to begin. Those grandparental investments are duly gone and soon my parents will cancel that standing order. It won’t be long till council tax kicks in full force, £818.15 for my band B flat. Gas prices are rising wherever I look. My landlord won’t stick to his ‘no rise, they’re just students’-policy much longer.

It would be nice to eat out once in a while, have drinks at the pub without continuously calculating, or buy CDs and books again. Gazing through the estate agent’s window, I envision a life beyond rented accommodation.

With ever-rising cost of living, debt is increasingly common among young people. The number of under-25s seeking help from the Consumer Credit Counselling Service has risen from 5.5% in 2002 to 12.6% in 2005, burdened with debts averaging £15,000. Of those calling the National Debt Helpline 15.1% are under 24.

I can’t help feeling that, if I want to stay in London, Iwill have to consider borrowing money at some point. Eventually that means debt, too. I won’t like it, but that’ll break my ‘golden rule’ – unless I drastically adjust its terms and conditions.

Comments

I'm in my second year as a teacher with similar feelings of 'joy' being virtually as poor as I was when a student. My parents were not particularly well-off and I didn't want to burden them with the cost of tuition fees... hence my £15000 student loan, two years into the real world. If I'm ever going to enjoy life, rather than simply survive in it, teaching will have to be a passing memory - it doesn't pay enough. I'm already on the lookout for tastier pastures... as are others at my school.

[John]

I am in the first year of my job and my student loan is around £13,000. I think that the current rate on that loan, 3.1% is a travesty since the inflation rate is far lower than that! So much for zero interest loans.

[M Brodie]

The teacher who contributed here might need to have a reality check on salaries in those mythical "tastier pastures": as far as I know the starting salary for a teacher is 22000 rising to 25000 with some years' experience. A head teacher can earn around 40000. Believe me those salaries are on a par with the private sector, actually better because teachers work for 9 months of the year not 12. Where do teachers get the impression that the private sector pays more than teaching? Only bonus-led jobs, e.g. banking, sales and estate agents that few well-educated people would enjoy, offer more when you're in your 20s. Don't be fooled: you have a good deal as a teacher, better than most in the cash-poor private sector do these days. At least your job's secure and you can get a key worker mortgage through the government! Otherwise - I can only say that it's apparent from these contributions that the government is robbing the young to pay the old, neither a wise nor a sustainable policy.