To wonder why anyone rushes to pay off their student finance?

[ChoppedChorizo]

A couple of friends of mine make regular overpayments with a view to paying it off quicker. Some have used inheritance to clear it. I don’t understand the motivation? The lot gets written off if you haven’t paid by X number of years.

Mine has continued to increase - I started uni in 2012 so my fees were around £7k per year. Plus living. It sits around £23k now.

Ive earned well enough but did a post grad (self funded) two years of training on the job and then had children and so two years of mat leave.

I don’t see the motivation to pay it off sooner.

It assumes a 4% growth every year. Fairly conservative but entirely possible.

Have you checked your loan statement recently? It’s not cheap! One point mine went maybe to 6% I have barely paid anything since the Liz truss tanking the economy. I have also been asked what my payments were and it reduced the amount I could borrow on my mortgage when they inputted it. Not that I have paid it off any quicker as I can’t afford to. I would also be about £140 better off a month without it

42 year old student nurse…by the time I finish (in September 🥳) I will have accrued £75k of debt in tuition fees and student loans and I’ve no intention of paying it off. That’s my honest answer. I hope to work 28/30 hours rather than full time and even full time newly qualified band 5 nurse is below the repayment threshold. I went into the career for job satisfaction (I know the nhs is crumbling, but I still believe) not to make my way up the ranks quickly.
I don’t see the point in trying to repay it. I don’t have any other debt or finance besides my mortgage and I overpay on that each month.

If you can get more in interest on savings than you pay on the loan then leave as is.

Have a day off.

You just posted to start a fight didn’t you. You’re not interested in the slightest about other people’s views. I think we all have the measure of you

I think there is a huge psychological element. My parents were frugal and told me never to take out debt other than mortgages.

We are lucky and saved just enough to pay our kids’ university fees outright. Only one year left. We discussed whether it would teach them more responsibility to pay their own way. But they are v hardworking and sensible anyway, so we paid the fees rather than let them start their lives with debts. I hope they will earn decently but either way, they can forget about loans. A privilege indeed.

I would never buy a car on finance etc as well. It’s not just a financial decision, but psychological too. I imagine that’s important for other people as well when they have the option to pay it off early. Even if it means paying a bit more than the mortgage. Decisions in life are not always purely ‘logical’.

And of course for many people, paying a student loan off may be more realistic than paying off a mortgage. People may just want to have one loan hanging over them, and will choose the mortgage.

I paid mine off when the payments hit over a £100 a month, in that year I also had to pay £500 out of my bonus and then rising living costs due to the cost of living crisis. It would be far more than £100 a month now so I feel much relief that I have one less thing to pay.

I think the point of most degrees is to learn. Hopefully you can apply that to generating more income.

A lot of people don't earn over the threshold due to part time working to be with their kids. Is it worth working more to miss time with your children and pay for more childcare, only for 9% or whatever of the extra money to go on your loan. To me it disincentivises working more hours.

The model builds in annual increases. You can see this if you click on the link

Call me Rocky.

@TieredCafe absolutely, I don’t generally like finance. I own a modest car outright and will drive that to the ground, we don’t so credit cards or loans, even buy my phones secondhand so it’s all SIM only. We just have the mortgage.

I have just never viewed my SL as a hindrance or really given it much thought until recently, but do need to consider it. At a stage where I’m stressing about pensions etc (must have too much time on my hands) 🤣

I’ve used the calculator so thanks to whoever shared that.

It was a big step for me getting a credit card as it had been drilled into me to pay for things there and then. However, I read that credit cards give more protection on big purchases, and can also help with your credit score. Who knows. Anyway, I have had one for some years now and pay it off every month.

I put a 4 year course starting this year in and a salary of 50k with a student loan of 65k -.repayments start at £187 per month and you would repay £141k in total over 27 years which is ahead of the age of 65/30 year write off period

Also to add the plan is now 40 years so there is that to consider for today's students, given the timescale over which this has extended up to 40 years I can only see this getting worse.- along with the interest rate it seems.

This! Some of us won’t get ours wiped because of when we took the loan out!

There's a petition about the huge interest rate on the mn petitions site, worth a sign and share widely. Expats csn sign it too.
I don't particularly like the wording on the petition but at least whoever set it up had the oooomph to do so. It's the signatures that are important