So, had some reading pointed out to me today which suggets that the reporter on this story did no fact checking, surprise surprise.
"Until 1 April 2007, borrowers who went overseas before their loans were repaid were expected to work towards repayment of the full loan balance within 15 years. Each year, the borrower was required to pay one-fifteenth of the outstanding principal and all the interest accruing on the loan. Many borrowers – especially those with larger loans and those who had low earnings while overseas – found repayments very difficult and many ended up in arrears."
So, 1/15th of a $70k balance is $4667 + the interest that was due on the principle that year, which for FY1999/2000 which was 7.0% (http://www.beehive.govt.nz/node/6880) which gives you an amount of $4900, or a total of $9567.
qwerty7: People take out student loans without any real consideration. I have no idea how people can be comfortable having such big debt [...].
I'm not opposed to running up debts. I would take out a big debt to study if the degree boosted by earnings potential enough to justify it, or if it was something I really wanted to study. I also had to take out a big debt when I bought my house.
However, I agree with you, it amazes me how people casually run up huge debts when they don't have to. Personally, I worked all thought uni (full time in holidays, part-time during the year, and took Saturday and Sunday work whenever I could get it), as well as driving a clapped-out rusty old bomb, to minimize my debt on completion. And I'm glad I did, as well as cash-flow it got me a valuable work history and referees for entering the permanent job market. Actually, in hindsight, these were probably worth as much as the pay I got.
Running up a debt because it's the only way to build a valuable asset is one thing. Running it up for beer, holidays, a flash car or because you don't want to work baffles me. Whinging that you shouldn't have to pay it back after you have run it up annoys me.
Yea don't get me wrong with consideration it can be justified, like if you calculate it out buying a house or have a plan and idea of what you will earn once you do the degree.
I am talking about the people who do a year of engineering, half a year of psychology and then graduate with a bachelor of arts degree and a 70 k loan while still not knowing really what they want to do. And throughout uni you would not think they are poor, they have a $1200 laptop and eat out for dinner weekly. Maybe it gives you allot of life experience, each to their own. Although I do not have sympathy for people who 'can't pay it back' .. tough sh*t. Or 5 years after they have graduated say they can't afford 10 % of their income going to pay off their student loan , takeaways and sky tv.. some people will say I am cruel , but they can suffer until they figure out how to save and manage money.
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