Check the maths before paying Accountancy Degree tuition fees upfront

 Dear Sam , I have a potential place at Plymouth University in 2012 studying  Accountancy, my parents have set some money aside, but should I pay my exam fees upfront rather than go into debt ?
Charles Dunstan, Southampton

Dear Charles
I refer to  a recent article published in the Telegraph by Martin Lewis from www.moneysavingexpert.com who covers the topic in far greater depth than I can
Sam Walpole

 Martin Lewis states Don’t pay your children’s tuition fees for them. This isn’t a ”let the little blighters pay their own way” rant, it’s a warning to check the maths first. Detaching the noose of student debt may feel laudable, but could leave some throwing away tens of thousands of pounds.

It’s now less than a month until UCAS applications for 2012 students close. Yet across the country there are myths and misunderstandings about the new £9,000 annual tuition fees in England. Many parents are scrimping, saving or even borrowing so that their offspring needn’t be burdened with them.

Yet while we call it a student loan, it isn’t a loan in the traditional sense. It’s a hybrid form of finance, nestling half way between traditional borrowing and taxation.

While many parents’ understandable reaction is to throw the kitchen sink at rescuing their children from this perceived debt, shelling out may not be the best course of action.

Put simply, many students won’t repay even close to what they’ve borrowed before the debt is wiped clean after 30 years; and if that’s the case, paying upfront is a waste. Yet that message isn’t getting out there
A costly role model

Some weeks ago a newspaper called me for a comment: “We’ve a great story. A girl has saved up nearly £30,000, so her parents won’t have to borrow to pay her £9,000 tuition fees – she’s a role model.” They thought I’d whoop for joy at her savvyness, but while it’s a “bravo” for the savings habit, the statement is wrong in so many ways and risked doing damage to her parents’ finances. First, everyone must understand that neither parents nor students pay tuition fees: graduates repay them, but only if they earn enough after they leave. The potential nightmare stems from the implication that this girl’s parents had planned to take on commercial borrowing so that she could avoid a student loan. In most circumstances, financially, this would be an aberrant decision.

Unlike normal debts, student loans do not go on credit files, repayments are proportionate to income, which stop if you lose your job, and there are no debt collectors. And while 2012 starters’ interest rates are sadly increasing – they’re currently at RPI (Retail Prices Index) plus 3 per cent – in the long run they’re still far cheaper than credit card and loan deals.

Pay upfront and you could lose £10,000s

Assume the simple scenario of students paying the £9,000 fees each year upfront. Then after they graduate they become low-paid artists, full-time parents … any scenario where they never earn over the £21,000 salary threshold for paying back the funding. In these scenarios, the £27,000 would have been paid unnecessarily.

While those are extreme cases, the inspiration for this advice came when I first plugged a nerdy calculation into my studentfinancecalc.com tool. I couldn’t quite believe what I saw.

Repaying a student loan is not like repaying a loan from the bank. It is linked to how much you earn, rather than how much you borrow.

Graduates only repay 9 per cent of any earnings above the threshold limit of £21,000. So if you earn £22,000 in your first year you repay just £90 of the amount you borrowed to pay for your fees.

If at the end of 30 years the total amount you have repaid fails to cover the total amount you borrowed plus interest accrued, it won’t matter as the outstanding amount will be written off.

It is also worth noting that the payment threshold will rise each year, in line with earnings (we don’t know how as yet), so if your pay rises do not keep up, your repayments could fall.

Using my online calculator, a new graduate earning £25,000 who took out a student loan for both the tuition fees and the maintenance fees amounting to £46,400 in total, would pay back just £3,400 more over 30 years than if he or she had borrowed only the maintenance fees of £21,500 and paid the £27,000 tuition fees upfront.

However, if a student earned £35,000 in their first year, which then rose at 5 per cent above inflation, paying the tuition fees upfront and using a student loan to pay for the maintenance fees would work out cheaper.

I have calculated that you would repay £49,700 less over the 30 years if you borrowed just the maintenance fees, than you would if you’d used a loan to pay for both tuition and maintenance fees (though you’ll have paid £27,000 in tuition fees upfront).

Yet short of employing a crystal ball, how do you know whether an 18-year-old student will be a future high earner? Even those starting higher education destined for medicine, the Bar or the City might change their minds, not get the grades, go into local politics or become full-time parents.

Stash the cash until you know more

The simple strategy is to put spare cash into a top cash Isa or savings account until graduation, when a student will have a better idea of earnings potential.

However, be aware that while studying, the loan interest will be RPI plus 3 per cent, which will not be fully offset by savings interest. So weigh that up against the risk of paying upfront unnecessarily.

A bigger spanner in the works is the Government’s ongoing consultation on whether it should introduce early redemption penalties. In my view that would be a perverse decision, as we’ve been banning it in the private sector for an age. If it did happen, it would shift the risk balance.

Use the money to prevent ‘worse’ debt

After studying, many go on to buy a house or get a car loan. While personal loans are at far higher rates than 2012 student loans, in the long run mortgages are likely to be roughly on a par. Yet a cash lump sum used as a substantial deposit could enable much cheaper borrowing and decrease the risk of arrears if you had a work break or income fall.

It isn’t a sensible strategy to use the cash to avoid a student loan if you’ll effectively need to borrow it back from a commercial lender later.

So that’s the maths, but of course that isn’t the be-all-and-end-all: the moral decision is yours. Many want to discourage debt-averse behaviour. And bear in mind that if you have the cash, but deliberately don’t use it as your child will not need to repay the funds in full, it’s the Treasury and taxpayer who foots the bill.

Martin Lewis is the creator of www.moneysavingexpert.com and head of the Independent Taskforce on Student Finance Information

For other helpful articles go to www.justaccountancyjobs.com

Simon Middleton : 10 Tips for Reinventing Yourself in the Workplace

 What people actually need to do is to assess their personal brand strategy with the same thoroughness  that successful companies like Apple, Virgin and others do for their brands. You need to look at what you want your purpose to be, whether as an employee, an entrepreneur, even as a life partner. From a solid purpose you can then build strategy and a powerful personal narrative – in short, the only way to build a powerful personal brand, one that will actually make any difference to your life, is to do it profoundly and deeply: to actually reinvent yourself – but authentically!

Simon Middleton is a qualified teacher, a registered nurse, and has been an advertising copywriter, creative director and board director of two successful agencies. He is the author of three books, the front man of the alt-country band The Proposition, and the founder of specialist music retailer Left Hand Bear which serves left-handed musicians all over the world, as well as running a respected brand consultancy.

Simons Top 10 tips:

1.  Your personal brand isn’t about your qualifications or even how smart you are: it’s about making yourself of distinctive recognisable value, no matter how modest your role. Even if you have the lowliest job, if you do it with an absolute commitment to excellence then you will get noticed.

2.  The greatest skill of all in a modern business or organisation is to be able to solve problems and to create more effective strategies. So instead of trying on the one hand just to ’fit in’ or on the other hand to be ’innovative’ for its own sake, strive instead actually to solve real problems. And remember that doesn’t mean having to be cleverer than others: sometimes it just means applying a little more attentiveness.

3.  The second greatest skill is to be able to communicate your ideas with regard for others’ understanding and position. Nobody likes a show-off or stubbornness, least of all managers in organisations. So be clear and make your case with conviction, but never be arrogant or uncompromising.

4.  In a small business, or in a team within a big organisation, your personal ’brand’ is best expressed through a compelling narrative about how and what you contribute. It’s no good claiming to be valuable. That’s like a comedian claiming to be funny. You have to ’be’ valuable.

5.  Along the way, and especially when your contribution is being noticed, you will find others who try to stop you, trip you up, or trap you. Pay no heed to those, other than to be aware of them. Engaging in inter-staff warfare can only damage your personal brand and will never enhance your career.

6.  Great brands are founded on authenticity, not on lies. Never, ever invent a better back story for yourself. You will, ultimately, be found out. Instead tell your real story: but tell it better by engaging emotions and imagination.

7.  Don’t go for promotion just because you think you should. Don’t follow the career path as though it was pre-determined. It isn’t. Think about your career strategy. What do you really, truly want to be doing in two or five years’ time? If a promotion helps take you there that’s great. But if it doesn’t, consider other approaches. A different company? Working for yourself?

Read the Full Story Here

Financial Controller Job Description Profile

Dear Sam……Our current Financial Controller is retiring and I need to write a new job desciption for the new role . Do you have any templates that I could use for this ?
Emma,HR Manager, Southampton

Dear Emma,
It is difficult to give a generic job description here but I have  2 job descriptions on our site , links below,
Sam Walpole, Ask The Expert

Template Financial Controller Job Description Profile
example 1

Job Purpose

To lead the company’s financial accounting, reporting and control activities accross the group of companies and to ensure they are carried out efficiently, effectively and in line with best practice.

Duties and Responsibilities

• Develop systems and procedures to ensure the efficient and effective management of the company’s finances.
• Using a financial control framework, including financial accountabilities and authorities to ensure full financial control.
• To develop and control a centralised accounting system to ensure that accounts are effectively managed.
• Act as the main point of contact to external auditors and provide all required information.
• Ensure accounting policies comply with the relevant accounting standards and that group policies are followed.
• Recommend changes that will improve the company’s financial performance and financial controls.
• Draft statutory accounts for the group of companies.
Skills / Attributes Required

• Fully qualified accountant (CA, ACA, ACCA or CIMA)
• Previous experience in a similar position, including experience of providing Financial Control across a group of companies.
• Sound and up to date knowledge of UKGAAP and International Financial Reporting Standards (IFRS).
• Experience of managing staff within the Accounts department.
• Excellent Excel modelling skills.
Salary
£45,000 to £50,000 plus Pension and 25 days holiday

Financial Controller Job Description Link

I am paid enough ? UK Accountancy Salary Survey 2011

  Dear Sam,   I am a part qualified CIMA accountant with exposure to mangement   accountants, but carrying out the complete financial accountin function for a £12 million manufacturing company in the Midlands, I am being paid only £20,000 without study … is this the market rate ?        
                                                            Rachael, Wolverhampton

Dear Rachael
Although manufacturing companies normally do pay under the normal market rate,  I would still say that your current rate is well under the norm.You should be on more £24/25,000, depending on what stage you have reached on your CIMA qualification , check our salary survey below for the exact figure.

Sam Walpole,  Ask The Expert

check this out at our 2011 UK salary guide here…..

              

Kaplan Free AAT Training

Editor’s Note : Free AAT training is available to both to the unemployed and the employed, through government funding for individuals who lack an accountancy qualification. This was news to me, so I felt it was important to circulate this widely.

Clark Hoy, Business Development Manager, from leading accountancy trainers Kaplan states :
“A career in accountancy and finance can be rewarding both professionally and financially. AAT (The Association of Accounting Technicians) qualification is a proven route into this profession, both as a standalone qualification and as a stepping stone to further qualifications. Accounting Technicians work at all levels from Accounts Clerks to Financial Controllers in all industries and sectors. The benefit of studying AAT will give you a great grounding in all aspects of Accounting which will provide you with the experience to carry out your job more effectively and to help career development. This qualification can be studied as part of an Accountancy Apprenticeship. If this route is chosen then full or part government funding is available*.”
For further information phone Clark Hoy, Business Development Manager on Tel 01908 540 059

2010 Graduate Work Placement Year leads job to success in 2011

Recent 2010 Kingston University Business Studies Graduate Mohsin Ashraf has been successful in securing a Graduate role with French company, Lactalis McLelland.   One of the world’s top 30 Food businesses, with a turnover in excess of €9 billion, Lactalis McLelland is the name behind the President and McLelland brand of cheese and butter.

Mohsin was recruited via Richard Perrott, Manager of Holden Jones Financial Recruitment in Wimbledon, who recruited the accounts team for the new shared service centre based in Redhill. He states, “it was a combination of Mohsin’s excellent excels skills, together with the business analyst skills he gained during is industrial placement year with IBM (with an advanced excel course giving him excel macro and pivot tables).  This coupled with his French language skills and extraordinary focus and enthusiasm, made him stand out from the other candidates. I strongly advise any student interested in a finance carer to gain experience through an industrial placement or relevant work experience, which will help you to develop the necessary business acumen and ensure your excel skills are up to speed. “

Mohsin passes a message on to his fellow graduates ‘My role as a Finance Analyst within Lactalis McLelland, has already given me invaluable exposure to financial accounting. This is as a result of being trained by some very high-calibre accountants, and through being given full opportunity to work on crucial projects for the company.’

Our  Just Accountancy Advice advice if you are a current accountancy graduate, is to go out there and make sure you have some relevant work experience in 2011 !!

Payroll Clerk Job Description Template

Job Purpose

To ensure accurate and timely in-house payroll production in accordance with statutory regulations.

Duties and Responsibilities

•  Arrange the payment of staff salaries through the computerised payroll system.
•  Administer the Statutory Sick Pay (SSP), Statutory Maternity Pay and Statutory Paternity Pay schemes
•  To process joiners and leavers.
•  Provide advice to staff and managers in relation to pay, taxation and National Insurance.
•  To assist in the administration of the company pension scheme.
•  To complete various forms required by HM Customs & Excise.
Skills / Attributes Required

•  Able to demonstrate experience in a payroll / finance related environment.
•  Able to demonstrate aptitude of using figures
•  Payroll qualification preferred
•  Excellent attention to detail.

Computer Skills
•  Strong Microsoft and Excel skills, Sage Payroll and Propay

Salary
£19,000 to £22,000 plus Pension and 25 days holiday

Example Advert

Payroll Manager
Within medium size practice this “hands-on” role for a portfolio of clients role will involve all aspects of payroll for a portfolio of practice clients, including calculation of SSP, SMP, utilising the BACs systems, processing P45s, processing year returns, dealing with the Inland revenue and reconciling P35s You have previous payroll background within a practice environment.

Other job descriptions here

Employment Legal Advice : Working Hours ?

Reader Question : I am working for an employer on a salary of £15k ayear for a 45 hour week, on average i am doing a 50 to 55 hour week which is 260 hour plus a year more. Does my employer have the rights to do this or should i be intitled to days in leiu or extra payment.

Our Expert  Employment Lawyer Philip Landau- responds

Under the Working Time Regulations, you should not be working more than 48 hours a week unless you have specifically contracted out of this in your employment contract. If you have not contracted out, then you cannot be forced to work these hours and if you are dismissed or have other disciplinary action taken against you because you are exerting this right, then you may have a claim for automatic unfair dismissal. If you  have simply agreed to work the extra hours without any understanding that you would be paid a higher salary, then there is little you can do. You may then want to give consideration to reducing your hours accordingly.

If you have seek employment advice from  Philip go here

Tips for writing a cv

I would recommend the following amendments to your CV:
1.       Change the CV completely from a chronological CV to a skills based CV.  For this type of CV, you need to build a skills profile based on your accountancy skills which should appear just before your employment history.  When you add your employment history, do not mention the skills you use in your current job, do not mention the skills you use for this job in your skills profile.
2.       When you write your employment history, just add the employers’ names, the dates you worked there, a short sentence about the company, i.e.: size, markets and what they do; it would also be a good idea to insert hyperlinks to employers’ websites so others can see what your employers’ do/have done.
3.       You should mention your Masters in Economics and your current studies for your AAT in your profile and your education should follow your employment history.
4.       You need to build a much more comprehensive list of accounting skills than your CV already contains, for instance, id you run a purchase ledger, how many invoices do you raise a month, how many cheque runs do you operate, are you responsible for reconciling the ledger, do you take it to trial balance and so on………….the more detail you add, the greater your chances of success.
If you follow the above recommendations, your CV will be a much more comprehensive and informative document.  I would also recommend the following layout guide:

1.       Profile
2.       Professional Skills
3.       Achievements
4.       Employment History
5.       Education and Professional Training/Associations
6.       Languages
7.       Additional skills, which should incorporate I T Skills, Interests, Drivers’ License, Availability and References.

If you need more help with your CV or would like to have your CV re-written by a professional, do contact me as I will be able to help you.  My website: www.justaccountancyjobs.com holds a great deal of infor,mation on how to write a good CV as well as pointers for writing a Cover Letter.

Good luck, and I wish you every success in achieving your career goals

I dont have any practical work experiences, what are the chances to get an accounting job in London after finishing all ACCA exams?

Dear Sam,

I am going to study ACCA in London in July, I am expecting to finish all my 14 papers by Dec 2010, I dont have any practical work experences, what are the chances to get an accounting job in London after finishing all ACCA exams?

 

 

 

Dear Yan

Many thanks for sending your enquiry through. Just Accountancy Jobs is an online job board, specialising in finance, allowing companies and recruitment agencies throughout the UK to post their relevant vacancies. The roles that are advertised do cover the full spectrum of positions within an accounts and finance function, and there could be occasions where a company would consider candidates with little/no work experience. It is never possible however to guarantee what positions are being recruited for at any given time. 

I would recommend that you register yourself on the Site. The system will allow you to set an alert up so that you are emailed positions that meet your career requirements and this will ensure you keep track of the positions being posted that are relevant to your situation, as well as give you a good insight into the current marketplace.

I hope you find this helpful, and good luck with your ACCA studies.

Sam

 Look here for Study Support Positions