Unfair student loan repayments and UC

[SLCUC]

I've name changed for this as mentioned situation to colleagues...

I currently earn around 28K and student loans deduct £53 a month from my wages. I have the possibility of promotion with just over 10k wage increase. This would mean SLC would deduct around £130 a month. Universal credit take my total wage before student loan deductions so therefore they see that I'm earning more than I actually am receiving, so I'm losing an extra 55p for every pound SLC take. I need to UC due to high rent and childcare but because of the double deduction I will barely be any better off. New role will bring a lot more stress and expectations of unpaid overtime. AIBU to say the method of student loan repayments is really unfair and no other debt penalises people in this way? And It's really not worth getting a higher paid job at the moment given the added stress and lack of financial benefits 😔

It is a stepping stone to future promotions and pay rises. You will pay off more of your student loan, instead of it continuing to accrue even more interest. In the medium term you will be better off for having the significant pay rise.

Don’t have the loan or in this case don’t go to university if you can’t afford to pay off the debt stop living off other people and pay your way

Will you be earning more overall or not? I mean I guess one way of looking at it is you're earning more so don't need the benefit? Or maybe I'm ot understanding the issue.

AIBU to say the method of student loan repayments is really unfair and no other debt penalises people in this way? And It's really not worth getting a higher paid job at the moment given the added stress and lack of financial benefits 😔

It isn’t anything to do with student loans though, its because your used to the UC and aren’t acknowledging the fact that you would be earning that money from yourself. Even with an increase in student loans and a decrease in UC I really doubt you would be worst off with a 10k pay rise.

You agreed to the terms of a student loan before you took it, no point complaining now. It coming out before tax also means when you were earning less you didn’t have to pay it.

You may be “barely better off” but surely as long as you are not worse off then it’s worth it. The career progression will eventually allow you to become fully independent and surely that’s the goal and not to rely on universal credit for ever.

Wtf the whole point is the loan levels the playing field a bit so people who want to can go to uni to further their career. They don't have a crystal ball.

And the increased pension is definitely not to be sniffed at

Wait can anyone claim UC if they have rent and childcare?! Why did I not know this was a thing?!

If it's public sector then you will get a much better pension by earning the higher salary for the next 20+ years. If you don't go for the job you are taking a very shortsighted view

Depends on how many children and household income. Definitely worth a look if you think you might be eligible. I'm the only adult in my house so not sure you'd qualify with 2 ft wages unless both were low and your rent was high etc

I agree with you. Think I was just panicking

Could you take a SLC break? Dunno if this is still a thing, but you used to be able to. It might give you the short term ability to make the stress “worth it”.

But regardless, you should take the promotion. The prospects are presumably better, you’ll be a step higher on the salary ladder, so who knows where the next stop will be.

Good luck OP. X

Also: congrats on the promotion!!!

If op didn't have to back as much of her student loan it won't get written off it would still be there to repay!

She is on the the 2nd scheme and the most harsh in how much you repay versus income.

I've done a possible scenario with the amounts you mention.

£10k pay rise translates to say £6k in your bank account = £500 p/mth

Increase in student loan repayment £77 p/mth
UC deduction 500 x 0.55 = £275

£148 p/mth better off
Doesn't seem a lot per day but as you're on UC I would assume that every penny counts and this is a sizeable number of pennies.
Also increased pension contributions.

Op does say more stress and more unpaid overtime though. As a single parent I can appreciate how a relatively small monthly financial increase would be wiped out by additional costs caused by lack of time eg having to feed kids on the go at McDonald’s as no time to go home between work & their activities or buying more convenience food as less time to batch cook.
Overall I’d take stability of higher earnings though.

Don’t have the loan or in this case don’t go to university if you can’t afford to pay off the debt stop living off other people and pay your way

Lucky for all the people in government who made the decision to give people accessing higher education a decades-long millstone around their necks, when they got free university - and maybe also a grant. Well done them for being born earlier....

What’s unfair you earn 40k and gave to pay your debts

@BotterMon you have got to be kidding me? On what planet in the current economic situation is a single 40k salary enough to house and feed a parent and children? Mad

You can actually discuss the student loan repayments, the amounts per salary aren't set in stone. If you explain your other costs and suggest an amount you could pay they take it into consideration.

I can't remember the salary amounts as it was at least a decade ago but they wanted to raise my payments from £70 a month to £210, I phoned them and explained that would be difficult and explained my rent and childcare payments and they allowed me to put it to £120 for two more years when I then increased to £210.

It does suck, not least because many of those currently in higher paying roles in the same industry probably didn’t have to take on student loans. They either got grants or started when it was still possible to work their way up.

You don’t need to justify why you get a top up to the judgy fuckers. You’re a single parent, you work, anyone that thinks they have the right to post snide remarks doesn’t deserve the effort. And they’re being hypocritical because statistically they’re unlikely to be net contributors either.

On £38k you won't be getting uc so it won't be relevant. It's above the average household income!

Ooh interesting to know. Thank you. No judgement by the way.

Well done on the job. Go for it. Significant amount to gain and you're like me.. Still won't pay it off anyway.

I’ll be honest on 28k a year I’m surprised you get UC. DH and I went through a rocky patch and I started looking at moving out, did an entitledto calculation as I earn £30k a year, I was barely entitled to any help. I’d have struggled to pay for rent On top of my childcare which at the time was about half my take home salary for both kids.

So I’m incredibly surprised you get UC at that salary and potentially higher.

On UC you are very dependent on the government of the time and your situation not changing. Good luck in your new role.