Do you think student debts hold you back in life and if so how ?

[LardLizard]

Or should I listen to Martin Lewis and think of it as a graduates tax

£50k loan .....

£25k salary = pay £35k till write off
£50k salary = pay £56k till paid off
£100k salary = pay £53k till paid off
£150k salary = pay £52k till paid of

BUT
the latter three are paying higher income tax

put in a 50k loan and a 28k salary. You still owe £43k after 30 years which is written off, but in the meantime you will have paid £114k.
Nope - paid £44k till write off

Not at all. Problem is everyman and his dog has a degree now and not everyone will pay them back. I can't see how the loan system can continue to be honest.

But from those very figures it's clear that, with the exception of the £25k salary, the higher earners are paying the least. If you put in a £35k starting salary then you pay £61,563 - far more than those starting on the highest salaries. If your parents pay up front AND you start on a high salary then you pay just the £50k. The rate of tax your parents paid is really neither here nor there, they'd be paying that regardless of whether they paid their children's loans off.

And that's all before you look at the amount you pay as a percentage of lifetime earnings. Not to mention the psychological and economic advantages you gain by paying off your loan early.

University is a choice.
If you do not like the way it is funded, do not go.

Its not really a choice for a lot of jobs though

No, the balance gets written off 30 years after graduation.

This is not necessarily correct - it depends upon when you took your loan out.

The following information applies to England and Wales only (scotland and NI have different arrangements.

Loans taken out between 1990-1997: after 25 years from first repayment or when you turn 50 (assuming that you were under 40 when you took the loan out, if you weren't then it's when you turn 65).

Loans taken out between 1997-2005: when you turn 65.

Loans taken out between 2006 - 2011: after 25 years of first repayment.

Loans taken out from 2012 onwards: after 30 years of first repayment.

First repayment is usually April following graduation.

I'm in the 1998 - 2005 group and I probably will still be paying my loan back up until or neat retirement as I'm now part time and repayments are low and mostly just cover the interest. However to answer the question no, it's never held me back in life. The system is in all but name a graduation contribution system and I personally think that is what it should be called rather than this potentially misleading language of fees, loans and debts.

I took my loan in 2005 so I will pay it back till I'm 65. This is 42 years after graduation and pretty much my entire working life.
It doesn't get written off after 30 years

DS1 needs a degree to do the job he wants to do.

University is pretty much the only way to get that degree. Same for teachers, nurses, etc.

If you don't like the way it's funded don't go? I don't like the way it's funded because students from poorer families come out with more debt. How is it fair that DS comes out with less debt because DH earns more than other parents? It would be cutting off our nose to spite your face not to go because you don't like the system of funding.

University is a choice.
If you do not like the way it is funded, do not go.

Killer argument that. I can't understand why the government has never used it in debates on the subject.

I don't think the current UK loans hold you back in any way- they should definitely be thought of as a graduate tax.

I got out a £10k professional development loan for a masters degree before you could get a student loan for them, and that definitely held me back for the 2.5 years I was paying it back. Thankfully that's not an issue for current cohorts.

However, if the government ever looks to change this I hope the British people send them a very strong message not to. The US system is a shambles and massively holds people back.

DH has US students loans (overall he borrow $60K- low compared to many) and it's a massive burden. His basic monthly repayment is $700 but we choose to pay $1400 as we're so desperate to get on with life. We're holding back on buying and house and having a child until we're done, and we're already late 20's early 30's.

Mine effected me after it got sold to erudio. It now shows on my credit file as £10,000 "in payment holiday" because I went to uni a long time ago and they put all my loans together (I had a year out so one was technically a different era and interest rate) so they chose the higher rate of interest on the whole amount which means it goes up by more than before each year.

When I applied for direct payments I was told I needed to open a separate bank account and was refused because I had a massive loan I hadn't repaid. I owe no other money so that was all it could be. I checked my credit history and they were right there was this massive loan recorded I wasn't repaying.

Prior to it being sold it didn't appear.

There was a thread on here when they were first sold and several people reported it as a problem but it didn't effect everyone.

Sorry to derail the thread slightly but I wonder if any of you knowledgeable people can help answer my question.
I did post on the Higher Education board but no replies...
I’ve just started doing a full time teaching degree as a mature student.
I’ve applied for a student fees loan which has been accepted and is in the process of being sorted out.
My question is, can I also apply for a student maintenance loan seperately (through Gov.uk) even though I’ve already submitted the fees loan?
And, if I’m eligible (which I think I am) is the maintenance loan repaid in the same way, ie only when I’m working and earning over a certain amount? Or does it have to be paid back with interest in a lump sum after I graduate?
Thanks!

It’s a graduate tax until you move out the country and stop paying.

Then it becomes an admin annoyance.

Thanks for the advice everyone, very usual I have a dd who wants to study something that takes about 7 years so wondering how the fuck we and she will afford it
Some people have been saying that in the last two years more apprentiships have become avalible, but think it would also be nice to experience the whole uni experience fully

How do you mean admin annoyance ? Can it affect your ability to move countries?

It doesn’t affect your ability to move countries (I have lived and worked in 4 different countries since graduating). It’s just more forms to fill out.

Hasn’t affected me, I just have to complete annual deferment forms which is a pain if they lose them.
Mine were sold to two different companies but SLC still deal with deferment forms. One company must know they are unlikely to get a penny back from me because they sent a final settlement offer which was less than the original loan.

Hasn’t held us back and didn’t stop us getting a mortgage.

It does suck that it comes out of your gross income though, so anytime I get a bonus at work I lose about half of it thanks to the tax man and my student loan. That’s just me being bitter though 😂