The brain capital tuition financing contract is also favourable for graduates with high income. As repayments are linked to individual solvency, financial pressure at beginning of the career when salary is still low is reduced and is rising again with increasing income.

The following example compares by concrete numbers which tuition financing costs can be expected.

The example is a student who starts at major bluechip company. Later on, he can advance his career and increase his income.

Taking into account fiscal deductibility, net payments to the tuition financing fund are in 31,624 EUR in total over a horizon of 10 years.

A potential alternative is loan financing. Assuming a spread of 3.5% on long-term EURIBOR and annual down payments of 5,000 EUR, the net expenses accumulate to 47,310 EUR.

The result is a significantly lower burden by the brain capital model:

This does not take into account that a student whose income falls below the minimum income (e.g. due to parental leave or MSc studies) does not have to do repayments in the respective year.