Student Loan

Glaucus · 6 May 2011 at 16:21

Strife212 said:
Why would anyone buy student loan debts? The vast majority are never going to be paid.

Why do you think that. You have like 30-40 years to pay it and by your 30s and beyond you should be on a reasonable wage. 35k is something like £1600 pay back a year. So you dont need to be on a highwage to pay it back. *waits for people to say that is high wage* it's not really when you are 30+ and been in an industry for 8years +

Average full time pay is now £31k.

Chris1712 · 6 May 2011 at 16:26

AcidHell2 said:
Why do you think that. You have like 30-40 years to pay it and by your 30s and beyond you should be on a reasonable wage. 35k is something. Around 1600 pay back a year. So youdont need to be on a highwage to pay it back. *waits for people to say that is high wage* it's not really when you are 30+ and been in an industry for 8years +

Written off after 25 years from 06 onwards.

Depending when the BOE restore interest rates, mine will be pretty tight paying back. Ofcourse I can't really predict but at a wage of 40k for the entirety of my payback time (unlikely) it would take most of that 25 years to pay back, assuming interest rates return to ~4-5%.

EDIT: If my wage was 31k throughout (again unlikely, will start lower than that but finish higher, well hopefully

) it wouldn't get paid off, instead written off at the 25 year mark.

Glaucus · 6 May 2011 at 16:27

You haven't taken into account inflation on wages.

And the lack of inflation on the minimum earning before repayment.

Average wage 1986 for example was just £12615

Chris1712 · 6 May 2011 at 16:30

AcidHell2 said:
You haven't taken into account inflation on wages.

And the lack of inflation on the minimum earning before repayment.

Touche! I wasn't aware the minimum earning changed with inflation though? 16k no?

Glaucus · 6 May 2011 at 16:31

Chris1712 said:
Touche! I wasn't aware the minimum earning changed with inflation though? 16k no?

That's what I'm saying, it doesn't change so each year you are paying back a larger amount due to inflation.

Replied before my edit, but 1986 average wage was £12600

So in 25 years your average pay will be sky high, yet it will still be 16k. Even people on minimum wage by then will be paying back large sums.

Chris1712 · 6 May 2011 at 16:34

AcidHell2 said:
That's what I'm saying, it doesn't change so each year you are paying back a larger amount due to inflation.

Replied before my edit, but 1986 average wage was £12600

So in 25 years your average pay will be sky high, yet it will still be 16k. Even people on minimum wage by then will be paying back large sums.

Ah good point. Oh well, its still the cheapest debt I'll ever have and worth it!

Strife212 · 6 May 2011 at 16:35

AcidHell2 said:
Why do you think that.

As chris says, it is likely to be written off before the full amount is paid. But it's true I didn't think of inflated wages.