student loan advice

OpenToSuggestions

OpenToSuggestions

OpenToSuggestions

Soldato
Joined
5 Aug 2006
Posts
11,426
Location
Derbyshire
Hi all.
I hav had a student loans thread before but I am still not sure what to do.

I have been at uni 2 years and owe circa 13k in loans, and at the end of 4 years would be circa 26k.
I have 2 more years but have savings to cover the loans part of these 2 years (almost).
I am an engineering undergaduate and expect to begin full time employment on over 20k, therefore from day one I will be paying my loan back.
Am I better to try my best to be as dept free as possible. The general reaction to this question from my friends is 'oh well you dont pay it back til you earn over 15k', but they are doing silly courses (eg media)

I am also seriously considering emmigration to the usa/australia in the next 5 years, which I assume if you owe money they wont let you go (and if they do let you go I dont want to be paying off a UK loan in US dollars!).
My personal opinion is that I do not wish to be in my mid 40s, paying back student fees on top of mortgage+bills etc etc. However this is exactly what my parents think and I think it has been drilled into me over the years.

Just looking for opinions from another persons perspective. I am not looking for a way out of the loan, I am just looking at the best option for me.

Take the loan and use savings in future towards a house, paying my loan back from each wage slip? Or pay it all back before I am 25, and have X amount of years dept free before a mortgage occurs (Could be up to 10years).

Thanks
Matt
 
If you move abroad you still have to pay it back.
The interest rate on it is now 4.8% so it isn't that cheap. 9% of over 15k, works out at a large chunk of you pay packet.
Take out as least as possible. Student loans suck :(. Especially as they just change the interest rate when they want. Even though the contract states it's linked to inflation.

I'm paying more a month on student loan than I am on my car loan. It's rediculuse and indents your money.
 
goujon945 said:
Two years i think
Click to expand...

Nope

Account holders Outside the UK Tax System

Those who are not in the UK Tax System - for example, because they live overseas and are paying their taxes in some other country - are nevertheless obliged to make due repayments. The following mechanism is used:

If an account holder is sought in the UK tax system and despite having a correct and valid NINO is not found, they are contacted for their current employment and earnings information. If this then allows them to be found in the UK Tax System, the process for UK Tax Payers is followed.

If it transpires from the enquiry that the account holder cannot be debited through earnings at source because they do not pay tax to HMRC, a form is sent asking them to document and evidence their earnings and this is returned to the Student Loans Company. We then establish the gross earnings, convert this figure to Sterling, work out the required repayment and make arrangements to collect this from the account holder. Repayments are then applied to the loan balance.
Click to expand...
 
I think it's only written off you become non-UK resident or domiciled. Look up the rules on that.
If you're UK resident and working abroad you're still required to make direct payments to the SLC as it's not taken through PAYE anymore.

If you have savings sitting there that you won't/don't need then use them before increasing your loan imo.
 
i never intend on paying it back apart form when its coming out my wages.

i worry about dying/becoming too ill to work etc . id be gutted if i spent all savings towards paying off my student loan, and then came across a situation where i really needed the money.
 
AcidHell2 said:
The interest rate on it is now 4.8%.
Click to expand...

Interest rate is now 3.8% and is one of the cheapest forms of debt you can have.

IMHO take the loan for the next two years if you are indeed eligible for it. After all its your public money gone into the system to pay for the loans etc.

If you go abroad and fail to notify the SLC they will actively try and track you down. If they fail to locate you, the 25 year rule will no longer apply.

So if you came back to the UK and they picked up on this, then you would have to pay it back still.

Best bet is to give them a call if you have any queries tbh.
 
Im quite interested to know how many people take the following approach:

"i never intend on paying it back apart form when its coming out my wages.

i worry about dying/becoming too ill to work etc . id be gutted if i spent all savings towards paying off my student loan, and then came across a situation where i really needed the money."

Im lucky enough to only have a £4k student loan debt, but ontop of that I have another £2k overdraft im desperatly trying to clear and its hard going. I cant see me putting any real effort into clearing the student loan other than what I have to.

Do many people do this?
 
i have roughly £16k in student loans, the 'interest' is around £70 per month so £840 per year. i would have to earn around £25k per year to 'break even'. Assuming a starting salary of £22k and an increase of 5% per year. after 10 years i would be earning 35k and my loan would be about £13k if the inflation figure stays the same. of course inflation could go down and i could be on more than £35k after 10 years. but it would take 18 years to pay back, my salary would be around £50k.
 
the vast majority of people will never pay off there student loans.

dont worry about it the repayments are so small its hardly worth thinking about
 
i will not make further payments than i have to as there are more important things that money could be used on. the only time i might consider it would be if i was earning a huge amount of money e.g. 200k a year or i win the lottery/long lost cousin Vlad dies and leaves me 12 billion
 
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