Student loan repayments are completely unfair

We do seem to shaft young people in this country

I think anything pre 2012 was fair. People have been shafted since then. I wouldn’t encourage a youngster to go now unless they had parents paying for everything or a very specific career path.

Exactly.

When I went to university many moons ago I paid nothing at all. My fees were fully paid and I had a maintenance grant to which my parents paid their small assessed contribution; I had a Home Office grant for maintenance and fees for my post-grad studies, and this even included an amount to support my husband who was still a student! I left university with no debt whatsoever.

I have been horrified by what my offspring have been confronted with when financing university.

The other huge difference is that when I went to university only about 4% of the relevant population did - because degrees were more or less all academic. Broadening the degrees on offer to incorporate non-academic subjects has helped no-one. As the quoted poster says, those who wish to gain the valuable non-academic skills that we all need so badly should have the option of paid apprenticeships. They need hands-on. Pulling all this into the degree system has burdened so many young people with huge debts and also skewed attitudes into thinking that only a degree is worthwhile and anything else is second best - which is clearly nonsense.

The whole parental pride in being able to say "my child has gone to university" needs to be turned on its head to saying "my child is studying for his future career."

I think things are creeping back in the right direction now. Critical to this is that society needs to value these skills on a par with academia.

I watch my graduate GS struggling to find a job after years of study and a good degree and knowing he will be paying back for years for this white elephant.

I really feel for these young people.

On plan 1 though the maximum fees were around £3k a year though weren’t they? Rather than the 9k on plan 2? I can see that making a huge difference to assumptions about when the majority of graduates would pay it off.

You can set up a standing monthly additional payment to SLC if that's the concern.

At some point there'll be massive enquiry lasting 6 years or so, which will both make and break several careers, there'll be endless court cases to test the water for compensation, and when/if those who are now about 25 years old reach 80, they'll get a couple of grand compo. Then there'll be more court cases etc, until everyone who started it or has been affected by it is dead, and the only people benefiting from it are the children of the lawyers who will have made a frigging fortune.

The only reason I can see is it forces the higher months repayments whereas OP doing this herself relies on self discipline to make a higher repayment each month which many would struggle with.

Financially it's bonkers cos double interest.

Accelerated degrees do exist, but most universities don't offer them and there are many more options in some subjects than others: https://www.thecompleteuniversityguide.co.uk/student-advice/what-to-study/what-are-accelerated-degrees#whichuniversitiesofferfasttrackcourses. They tend to only be offered by universities that are teaching-focused rather than teaching and research.

I wonder if mine was different as Scotland?

loan 2006-2010

band 5 nhs job, paid off after 5 years

the interest rates people are quoting are astounding. Criminal.

I don't understand why you'd get a loan to pay it off quicker? If you're in a position to pay more than the required student loan payments to pay it faster you can just do that directly, either through an additional monthly payment or through lump sums whenever you have the money - and, unlike many other kinds of debt, there's no charge or cap on overpaying.

I'm 40 and still owe £27k. It will never be paid back, due to a combination of a career change in my early 30s (so I've done 2 undergraduate degrees and took a loan for both), taking 2x mat leave so being out of work for 2 years, and now working part time on a band 6 NHS salary. There have only been about 4 years in my whole working life that I've earned enough to pay back more than the interest that accrues; otherwise than that it just gets bigger every year.
I mostly ignore it to be honest. There's nothing I can do about it and I have enough stress trying to pay the mortgage and my immediate living costs without worrying about that.
I do think it would be interesting to see a breakdown of the proportion paid back/ still owing by sex. I suspect women would be disproportionately represented in the group that still has a significant amount left to pay / will never pay it back.

I've always wondered why a 2 year fast track option has never existed. I guess it would mean more work for teaching staff and shorter holidays?

Plan 2. Mine will never be written off. Tbh im envious of those who's debt is written off

But if most people never repay the capital what is the point of the punitive interest rates? That’s the bit that is unfair not repaying the capital. Make it the same as inflation at most with a cap for high inflation years. That would be fairer and then, like magic, majority of grads could actually repay their loans within a reasonable number of years.
why have massive interest if not to artificially inflate the debt and keep grads indebted due to compound interest

Totally agree. He has a lot to answer for. He really over did you should definitely get a loa even inf you can afford not to and forgot to mention till the impact of compound interest and the potential for rules of the game to be changed.

The unfairness is in the fact that if you are a middle earner you end up paying back more than if you are a high earner. It’s a regressive tax.

It’s such a difficult problem. The UK has pushed the cost of higher education onto individuals, which has created these massive student loans, but there’s no appetite to increase taxes to increase public spending on HE. More and more jobs require higher level skills but the graduate wage premium has been eroded. Apprenticeships are great but it moves the cost of education and training onto employers (including public sector employers) and they can’t/don’t want to pay for it either.

Part of the loan is about living costs while studying, so one solution could be to restructure terms/semesters to enable students to either work while studying or to complete a degree in two years rather than three. The criminally high cost of student accommodation needs to be addressed as well.

You don't seem to understand the system. Whatever you owe when you get to the point where it is wiped is...wiped. Not repaid. Doesn't matter if it's capital or interest. If it was a mortgage that wouldn't happen- you keep paying. Most people never repay the capital they borrowed, therefore the interest is irrelevant. It's also the only type of loan where repayments fall or stop if your income falls.

If you feel your loan is unfair please confirm that you have already repaid all the capital you borrowed.

One of the more recent loan plans paid back for 30 years, but the Tories were worried young, academic people from lower income families weren't being punished enough for having the audacity to progress to higher education, so raised it to 40 years. As if young people don't have it hard enough already.
Obviously they knew that those young people who were fortunate enough to have had mum and dad bankrolling it would be unaffected.

I’m conflicted on this now.
The interest is unfair , and that higher paid grads have an even higher interest is completely unfair and the time you have to pay it is worse than a mortgage.
If it truly was a low cost loan many more would clear it earlier in their careers.
BUT I am reading articles with people who have been students longer than the usual 3 years then surprised their loans are higher than everyone else.
They’ve basically lived off the tax payer for 4-5 years or even longer and to now complain seems a little rich of them.
And also people that have paid v v little in their early careers as they didn’t earn much and now complaining when they have to pay more.
They weren’t complaining when they were paying nothing or £30 a month. They weren’t happy with the loan system then.
So on balance yes it’s unfair and should be fairer but some people could also have made better choices themselves, maybe worked first to pay for their masters and living themselves rather than taking a loan.

I'm 45 and paid mine off about 12 years ago. And I'm not a particularly high earner. It's hardly a "lifelong debt" in most cases.

Lucky enough to be old enough (ha ha) not to have gone to uni in the student loans era, however my children are both approaching university age in the next few years.

What are people’s thoughts on the current loan?

I was on Plan 2. Higher rate tax payer yet still not able to make a dent in my loan. I'm not sure how many years it would've taken me to pay back but it was decades.

I ended up taking out a loan for my balance of 18k, bit the bullet and will now pay it back in two years of being particularly frugal.

I can't help thay think that uni, for the most part is a con. And as for Martin Lewis saying about thinking of this as a graduate tax - I think that has been really unhelpful to the 18 year old out there that can't think further than next week.

Its almost criminal having these kids sign up for a massive, possibly lifelong financial commitment when the reality is they would be declined by the bank for a 1k credit card.

We need more apprenticeships and work based qualifications.

YANBU. I’m on Plan 1 and had no idea that I’d have the debt till 65 when I took out the loan in 98. As you say, the interest snowballs and I’m never going to clear it before then.

It feels very unfair. If I’d been a year or so older I’d have had a full grant as my parents were low earners.