Is anyone else going to have a student loan until age 65 (Plan 1 pre 2006)?

[studentloanuntil65]

I have a Plan 1 student loan and had no idea that I’d have the debt till 65 when I took out the loan in 1998, at age 18.

I’ve never been a high earner and took time out of employment to look after our children due to the high cost of childcare and no family support.

The interest has snowballed, even while I was working, and I’m never going to clear it before I’m 65.

It feels very unfair when I’m seeing that people on the other loans have theirs wiped out after 25 or 30 years. I’m 46 and have already had this loan hanging over me for over 25 years.

I didn’t realise until seeing a BBC article this morning that other people on plan 1 (2006 onwards loans) get theirs wiped after 25 years! Mine would already have been wiped. And if I’d been a year older I’d have had a full grant as my parents were low earners.

No, I’m not having to pay it back, but it’s still a weight on my shoulders knowing that I owe it. When I became a SAHM they wrote to me and told me that my husband had to write a letter to them confirming that he was supporting me, with evidence via bank statements, which seemed a bit ridiculous as I’m supposed to pay the loan back via PAYE when I earn enough.

Is anyone else in the same boat with Plan 1?

@JemimaTiggywinklesI know how it works. It’s not about those who will pay it off, let’s face it how many on plan 2 actually will; it’s about who will earn the minimum, plan 2 are bitterly impacted by this given how hard it is to get the loan down. I barely made any payments on my plan 1 loan for a decade while having kids, but the interest was so negligible at least it didn’t grow much and it hasn’t taken much for me to pay it down since working full time.

While plan 1 has a lower threshold, it’s hard to know without knowing what OP was earning the 15 years she said she was before having kids. But while plan 1’s threshold hold is lower, plan 2’s is still under the average UK salary and not exactly a tall ask from a university graduate.

Yeah it was mildly annoying at the time but I don't think it was vastly less than my English peers were getting - hundreds less rather than thousands. Everyone I knew with middle class parents had their tuition fees paid for them as they were so low. My halls were £55 a week.

OP current students are on Plan 5 and on this plan loans are written off after 40 years. So more similar to yours.
It is depressing to be paying back a student loan until you're in your 60s, no two ways about it. Most of the Plan 5 students will leave uni with at least 50K of debt.

Err that isn't true! I started in 1996, I had a grant but STILL NEEDED A LOAN, or me and my 4yr old DS would be homeless, as the grant was not enough to cover rent (unless you lived at home and didn't need to rent of course)/

Yeah we could get £3k a year. Or £4k if low income. Which still didn’t cover the costs of hall’s and food and everything else but did a decent chunk of it! And yes most people I knew paid fees upfront as it was comparatively low to what it is now anyway!
We were all horrified in the third year though to see we’d gained a thousand in interest already as we’d been led to believe it started when you left uni.

My husband is in the same situation - he's never earned enough to pay it off and I can't see he ever will. We got a letter a while back suggesting I might like to pay it off for him so I ignored it.

I took mine out in 2005 and will never pay it back. I might pay a bit in the future but I've barely paid any since I graduated.

Went straight into full time work related to my degree but didn't earn enough to pay it back. After the kids I now work part time so definitely don't earn enough.

I don't think about it tbh, it doesn't affect me in any way and if on the odd occasion I pay a bit then fine.

My degree was never really essential and you could easily get to the top without one. I only did it because I didn't know what else to do and felt like it was the done thing.

Absolutely no regrets, I had a lot of fun, met a lot of people and managed to escape my tiny village. So if I do end up paying a small amount towards it forever then it's a small price to pay in my opinion.

I was at uni 1992-5 and took out the maximum student loan , I never earnt over the threshold to pay it back ( about £25k I think ?) then became a full time carer for a disabled child and didn’t work ; it got wiped after 25 years without me paying a penny .

I don't have one of those Plan 1 loans but I'm in my 40s and have just taken out a new Plan 5 loan for a second STEM undergrad degree, which I believe won't be wiped until I'm in my 80s. I'm quite chilled about it, I will probably work pt so may be under the threshold and then will be retired so it won't affect me much. Our mortgage is just based on DH's salary so affordability isn't affected.
My other student loans were never much of a weight on my shoulders (I have been under the repayment threshold most of the time) and I don't think the new one will be either, the weight of it is just a psychological thing that I'm able to forget about.

It was only in the last few years once I was earning over £45k that I've made a real dent in mine. Four years max loan so about £15k when I graduated.
Will you be able to go back to work and what sort of salary would you be able to achieve. I know you said salaries are low but being a SAHM you're also not possibly going to have much pension unless your husband and you have started a private one for you. Although you won't be paying your loan back then you will likely have even less income without it hanging over you. For reference, we also pay back at a lower income than subsequent plans not much over full time on minimum wage . Even if not full time once kids are older then few hours would help build some pension and give you a bit extra income for now even if you're not paying the student loan off

I had loans from the early 90s, after deferring the repayment every year due to not meeting the salary requirements, mine was written off when I hit 50, so 5 years ago.

OP I’m in the same boat as you. Maximum loan so that I could pay rent etc, hit the earnings threshold and started paying it off when I was about 25, had kids at 30 and went part time and haven’t earned enough to pay any off in the decade since. I haven’t a clue how much I owe and I don’t see the point in looking as I’m highly unlikely to earn over the threshold again. DH is the same age but had a smaller loan and has always worked full time so paid his off a few years ago.

@studentloanuntil65 OP, if you do the maths and you see that you will not be able to pay off your student loan, and if you're workplace allows it, it's sensible to use salary sacrifice to minimise the amount you're paying back on the student loan. Some workplaces allow you to get a nice electric car with salary sacrifice, or put more into pension.

I also had a plan 1 loan, at graduation it was £12K and by the time I started paying it back after a (paid for) post grad it was £16K. I had repaid it after about five years at work, with some voluntary overpayments to clear it at the end. Losing the repayments from my salary was the biggest pay rise I have ever had I think other than stopping paying for nursery when youngest went to school!

The repayment threshold was only £15,000 in the late noughties so OP must have been in a very low earning job never to have made any payments at all. OP, I agree with others that if the total cost of your degree is having to write a letter every so often you are a lot luckier than most of our generation and a hell of a lot luckier than those who came after us with their £9K per year tuition fees.