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Original poster

Just paid off my student loan

82 replies

ChiefClerkDrumknott · 15/02/2022 13:38

After taking it out in 2000 😱 Had a few years where I didn’t pay off anything due to not earning enough. Then over the last 2 years or so I’ve managed to get a lot of overtime and chipped away at it.

On the one hand I’m pleased it’s done, on the other I’m horrified at how long ago it was that I first had it. 2000 was like 8 years ago, yeah?

OP posts:
WalkingOnSonshine · 15/02/2022 21:55

I should pay mine off from 2007 at the end of this year & the payment is then going into my pension.

Crazy that it’s been 11 years of paying it off & yet my MSc just came from my savings.

WalkingOnSonshine · 15/02/2022 21:56

As in started in 2007, graduated 2011. In case anyone thinks I can’t do maths!

Cameleongirl · 15/02/2022 22:00

Congratulations, OP! My DH has taken the opposite approach for his graduate school loan as he's on a very low interest rate so he's not hurrying to pay it off...he'll be 60 when he finally does. A full 30 years. Grin

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Cameleongirl · 15/02/2022 22:06

That's in the US, btw. It won't be written off, as far as I know.

AwkwardPaws27 · 15/02/2022 22:11

@TizerorFizz

Memory fail: DD graduated in 2014. She’s earned money for 4 years as 3 were professional courses and a training year.
Woe. That's seriously impressive - assuming that's tuition fees and maintenance loans, close to £60k paid off in 4 years!! It took me 3 years to save up £9k for a flat deposit Blush
HootOwl · 16/02/2022 03:06

Well done OP! It's such a huge relief when you finally get free from this extra tax.

DropYourSword · 16/02/2022 03:22

I can't technically pay mine off! I owe something stupid like £0.53 and I can't pay it as the minimum EFT transaction is something like £5 - £10! And as I emigrated I be can only do it by electronic funds transfer.

I periodically brood that it's not yet paid off!

OhNoWhatYouGonnaDo · 16/02/2022 07:18

@camperqueen54

I'm pretty sure Martin Lewis says it makes no sense to pay this off early but hey ho!
Depends if it's Plan 1 or Plan 2, and if you earn enough that you will soon end up repaying it anyway. I was on Plan 1 and as a high earner was earning enough that I would end up repaying the outstanding balance in the next 2 years, so I paid the outstanding balance in one go - saved myself some interest and a lot of hassle (I'm partially self-employed and partially employed so I always had to pay a chunk of loan at tax return time anyway). If I owed loads and was a low earner who would never pay it back, I wouldn't have done it.
TizerorFizz · 16/02/2022 07:43

@AwkwardPaws27
DD was the circa £3000 pa tuition fee and she had the minimum maintenance loan. So around £35,000 I think. She did 1 year Erasmus out of a 4 year MFL degree so she got maintenance from them that year. She then did a GDL and the BPTC and then 1 year as a pupil barrister where you get 6 months of earnings after your first 6 months. Then you become self employed - you are a “tennant” at your Chambers and pay part of your earnings as “rent”. This whole scenario was new to me and her dad! However turns out she’s doing very well and she told me last Saturday she was paying off the remaining £6000 of the loan. She’s a high earner but she works like mad!

Other DD has yet to pay off 1p! We will view hers as a graduate tax!

TizerorFizz · 16/02/2022 07:46

No. Not £35,000 . Nearer £25,000. As @OhNoWhatYouGonnaDo says, plan 1 and self employed makes a difference. DDs view was get rid of it and divert more into pensions.

Summersdreaming · 16/02/2022 08:04

Just checked mine and the interest added is higher than my repayments. I think (hope) that will flip soon but as it stands I'm paying for no gain.

Summersdreaming · 16/02/2022 08:04

Plan 2 ^

WaterBottle123 · 16/02/2022 08:05

Great moment OP!

TizerorFizz · 16/02/2022 08:18

No one is required to pay it off though if they don’t earn enough. Part time working affects repayments but these loans are written off. Therefore treat it as a graduate tax as Martin Lewis says. It’s not a debt for most as it doesn’t require repayment. It’s also written off Post 2006 25 years after the first repayment. For earlier loans it’s 65. For many it’s not worth paying it off. The money can be used more constructively elsewhere. But everyone needs to do the sums.,

Original poster
ChiefClerkDrumknott · 16/02/2022 23:18

@TizerorFizz Mine had a few hundred left to go as I’ve had a lot of overtime in my work, mostly due to the pandemic. It would have been paid off in a few months anyway due to the ongoing overtime, but I had the funds so thought bugger it, get it over and done with Grin

OP posts:
Original poster
ChiefClerkDrumknott · 16/02/2022 23:18

@WaterBottle123 It was very satisfying Wine

OP posts:
Original poster
ChiefClerkDrumknott · 16/02/2022 23:20

@Summersdreaming Hope it flips for you. That’s mad that the interest is higher than the payments!

OP posts:
ChocAuVin · 16/02/2022 23:24

Mine will be paid off this time next year and I cannot wait. Spent many years with young kids under the threshold but have been chipping away for a fair few years now and finally there is light at the end of the tunnel.

EricScrantona · 16/02/2022 23:30

Student loans piss me off. They sold it as "inflation only". I remember a leaflet comparing it to the cost of cd's and saying it's like buying the same shopping trolley ten years apart, it will only cost more because of inflation. I've not described it well but it's bollocks.

Having seen my statement, for the three years I was there I was getting charged interest of £60 a month. I saw it on the statement. That was my first hint it was bollocks. I remember the first year I started paying it back, I owed more at the end of the year than the start due to interest. It's a never ending load of bollocks. DH will pay his off this year but he has earned significantly more since the start really.

TizerorFizz · 17/02/2022 08:41

Well if you don’t earn much you won’t pay it off. The monthly amount isn’t huge for most. You are not required to pay it off.,

RandomMess · 17/02/2022 09:20

@TizerorFizz that's not true it depends on when you took out your loan to which "scheme" it was. I think it's the 2nd scheme that was hugely unfair, to be repaid once earning minimum wage full time and then a fixed amount - I was horrified when I saw their terms and conditions.

TizerorFizz · 17/02/2022 10:56

It doesn’t all have to be repaid. That’s the point. None of them require that. So interest doesn’t matter for quite a few. It’s still better to get a loan than use capital and it enables more to go to university. That may not necessarily be a good thing but university attendance has continued to grow so no one is being put off much it would seem..

AwkwardPaws27 · 17/02/2022 12:11

[quote RandomMess]@TizerorFizz that's not true it depends on when you took out your loan to which "scheme" it was. I think it's the 2nd scheme that was hugely unfair, to be repaid once earning minimum wage full time and then a fixed amount - I was horrified when I saw their terms and conditions.[/quote]
Luckily it's not minimum wage for Plan 2 - the threshold now is about £27k for undergraduate (I think it started around £25k originally - I remember starting to pay when I earned that and it was was about £1 a month) & £21k for postgraduate.

The interest is a kicker though - the interest rate was quite a bit higher while I was studying, over 6%, so they were adding over £200 a month of interest while I was at uni.

The interest is still over £100 a month now and I think I pay around £30, so it goes up quicker than I can pay it back. If I have any extra money in future to throw at debt I'm better off overpaying the mortgage than paying off a (Plan 2) student loan though.

DH is on Plan 1 and we have a much more realistic chance of clearing that, but if he lost his job the payments stop - whereas the mortgage & car loan don't - so its not a high priority.

SunnyKlara · 17/02/2022 12:21

@TizerorFizz

No one is required to pay it off though if they don’t earn enough. Part time working affects repayments but these loans are written off. Therefore treat it as a graduate tax as Martin Lewis says. It’s not a debt for most as it doesn’t require repayment. It’s also written off Post 2006 25 years after the first repayment. For earlier loans it’s 65. For many it’s not worth paying it off. The money can be used more constructively elsewhere. But everyone needs to do the sums.,
But OP did do the sums and it made more sense for her to pay it off. So she did.

Congratulations OP! I can't wait for the day mine is gone (approx 3 years). That money will then probably go to overpayment on my mortgage, but it's be nice to not have to deal with the SLC anymore! I always worry they'll fuck it up!

RandomMess · 17/02/2022 12:24

I just remember the bonkers time when my WTC that was to help cover childcare costs and partial housing benefit were taken as income and they wanted me to start repaying.

As a single parent working full time it was insane as the repayments weren't tiered! No allowance made for the fact that the WTC didn't cover anywhere near my childcare costs.

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