To think student loan shouldn't be deducted from nmw

[HolidayBurden]

The threshold for plan 1 is so low now that from April 33 hours a week at minimum wage will trigger the deduction. Surely they should raise the threshold now? I can't see any information regarding this changing.
the oldest plan seems the worst for this.
It is distinctly possible I've missed information about future changes and will be very grateful to any knowledgeable posters with advice.

Each year is the same loan so all count as pre 2006, if I understand your question. We went at the same time which is quite shit from that image, we seem to have fucked ourselves over.

Thank you @AcridAndStanLee , so because I took first loan out pre 2007 I am faced with the longer wait for them to be written off?

Childcare is your problem not the student loan repayment. We had one child and worked opposite shifts to keep ours reasonable.

The problem with a graduate tax is your forcing people to pay for others to go to university, when they or their parents funded their own education which isn't fair or palatable.

Personally I think the % paid back should be lower but the threshold should be the current tax free allowance as at the end of the day you borrowed the money and choose the job you are working in. Taking pay rises in the beginning seems counter intuitive as you're paying back more but earning little extra. Long term it's a good move as once the loan is gone (11 years to repay mine on a NHS salary) you get a nice pay rise.

The problem is you always hear not to make over payments which is stupid as the interest rate is what 6% if you know it's not going to be written off you might aswell clear it quicker whilst your young!

That's how I read it. Bit of a joke as I rushed to go before the rate went up from £1200 per year to £3k. Would have been better off not.

@sleepyscientist child care is each persons responsibility but is it fair that you had to have opposite shifts and limited to one for the government to receive ridiculous interest rates meaning the debt will cost loads or never be paid back? I say that as someone who wanted loads of kids but due to childcare costs was limited to one.

I don't think anyone is arguing that we should pay back but we were mislead as to what we would pay back. My example further down, every year o am paying back £100 as the rest is taken in interest. I looked at the last few years statements and have been paying £1k but the debt hasn't gone down. There must be a better way to repay.

That is for one child 🤣 well, almost. It's £180 for the other child
And yes, childcare is the issue but the other issue is £400 student loans that don't pay off the balance of the debt ! I'm in my mid 30s and still owe them over 40000. What a farce!

Yes, it's just plain fact that nobody signed up for the 2024 economic situation. In particular, a load of adolescents in the late 90s and 00s, some of whom were still children at the time, did not.

@Whatapickle23 absolutely spot on! I feel had over!

The problem with a graduate tax is it doesn't deter people from taking low value degrees that don't improve their earning capacity. It spreads the burden of paying for worthless courses onto people who didn't choose them.

Sadly, the expansion of higher education in the uk has resulted in some pockets of genuinely pointless degees at very low value institutions. Having to pay back £40k plus for an arts degree from a low ranked institution really should be making people consider course outcomes and whether a course is worth the money.

@Scottishshortbread11877

No, not written off until 65

If you started studying in the 2005/06 academic year or earlier, your Plan 1 Student Loan will be written off when you turn 65. If you started uni in the 2006/07 academic year or later, your Plan 1 Student Loan will be written off after 25 years.

I went to uni in 1998, first year of tuition fees, I had no idea at the time that the way loans were paid back was vastly different to how it worked previously. The internet was still in its infancy, it was not as easy to find or discuss this information.

I echo this.

Higher education is not cost free. The recipient sharing some of the cost burden, rather than it wholly being covered by the tax payer seems fairer to the country as a whole. And if on plan 1, there have been many years to boost income above NMW.

If the institutions themselves bore some of the cost of the students who pay back little, you'd bet they'd do a lot more to ensure their courses gave people skills valued in the workplace. They'd also offer a more realistic number of the arts courses that often aren't in demand with employers.

Yeah, especially if you didn't happen to have access to adults who understood how repayments would work.

Totally agree that the 'advice' on student loans has been very poor indeed.

Especially so in the early days.

You were told it's not like a loan, don't think of it as debt etc. when, in fact, it's like a very bad loan indeed. With interest rates that have been worse than a commercial loan and far less protections as the money is taken off you before you are paid etc.

Astronomical amounts of money owed and little advice for young people about how to get the best value for more lifetime of debt.

Plus an economy that now demands degrees for everything - thus devaluing them because everyone has one.

It's just become an almost mandatory lifetime of debt for some people.

For going to uni you should make a contribution back unlike those who don't go.

I have and under grad, post grad and a masters, alI self funded by studying as a mature student while working full time - I’m in Scotland but for various reasons didn’t get any student funding. Having done that, you now think I should also pay a graduate tax?

I think there needs to be a better way, interest rates meaning people aren’t actually paying off the capital are ridiculous but deciding that everyone who graduates pays a higher level of tax regardless of how they funded their education isn’t it.

People don't earn more in real terms, the increase is due to inflation

Yeah, especially if you didn't happen to have access to adults who understood how repayments would work.

Indeed. I suspect many of us in the late nineties were the first in our families to even go to uni. Literally no adult I knew had any clue how any of it worked or how it would be funded.

I had to go and make it up as I went along. With little internet access and no school input into funding. I was flying blind - as many of us were I think.

I got lucky in that I dropped out early so had less debt to pay back. And got a good job in London (unrelated to my part degree) which once paid out a massive bonus that allowed me to clear it early.

But I feel for those not in that position.

@LetsgoLego it good to see someone who grasps just what Blair did. Did you by any chance work in HE?

Knowing what I know now, I wish I'd never bothered going to university.

It's made absolutely no difference to my career and I've never more than a few hundred pounds back since 2011. My interest went up £500 this year alone.

It's batshit.

Luckily mine get written off after 25 years.

I can well believe it. Added to which, some will have been still children when they signed up to the loans.

This is why, even though my degree was helpful and I probably wouldn't have got my better paid than average pro rata job without it, I don't feel the slightest guilt at not repaying. The reason I owe it and will until I'm 65 is because I was born when I was to parents who couldn't have afforded to pay the costs upfront. Plus it was sold off anyway. So fuck that for a game of soldiers.

Honestly my biggest beef with the student loan system is that the rules aren’t the same for everyone. Some get their loans written off after 25 years. Others don’t get their loans written off till they’re 65. So I would be campaigning for consistency first.

@Merangh I think that's only because the amounts paid out changed substantially. Tuition fees in early naughties were very low compared to those taken out post-2012. Perhaps 2012 would have been a fairer cut-off.

By the time I went to uni and finished my degrees I owed about 46k in tuition fees alone (excluding maintenance) whereas my brother (and husband) only owed about 9k. Theirs was low enough that they eventually were able to pay it off (well before 65) on jobs that earnt less than 50k per year. With the high interest mine will never be cleared in full even though I earn substantially more so think the 25 year cut off works in my favour.

Great for her, genuinely! That seems like a reasonable trainee wage. It's a shame not everywhere pays like that.
My friends in a small town had to work as assistants in accounting firms for a couple of years because there wasn't any trainee accounting positions available (could they have moved? Yes but they have family, friends and ties to the area they've lived in their whole life). Assistant wage started at minimum wage.
Then once they managed to get training contracts, they're earning just less than £24k. This is several years after finishing their degrees.

The problem with that is that would mean either retrospective changes, or that governments cannot change the loan system, ever.

Surely it is a graduate tax in practice?