Student loans- feel sick

[Lazy56789]

I did a degree around 15 years ago, and a Masters around 10 years ago.
A repayment is taken out of my salary each month based on my earnings, but when I received a letter from student finance today I saw my balance was 41k! And over 2k in interest was added in the last tax year.

It's terrifying, I'm not in a position to pay off huge amounts, how does anyone do it? The figures are eye-watering, I feel like i must've done something wrong for it to be so high?

I was and am money savvy but worked 25-30 hours a week whilst I studied just to get by, even with the loans! I received mostly grants as they were still a thing then due to low income/family having no money but still borrowed about £40k, £27,500 in tuition and £12,500 in maintenance loans. Nothing else I could have done really to not graduate with debt - the worst is that the interest starts the day you start uni, not after you start paying it back. It should be all interest free imo, but at LEAST the years at uni should be if nothing else.

Did you live at home? That wasn’t an option for me, I had to move out at 16 so paid my way through college when doing my A Levels too, and then 3 jobs whilst at uni.

As @Juniperberry55 and @ShesTheAlbatross have since pointed out to me, the repayment "due" is based on when you leave uni, not when the first payment is "due" based on when your earnings are high enough to warrant repayments starting. I will readily admit that this was my firm misunderstanding, based on how the information on the official websites has been worded.

I would argue a lot of jobs require a degree (or at least they did when I graduated in 2015 - my industry has only recently stopped asking for them) only to pay an average salary. My industry starting salary was £18k when I graduated but needed a degree to it. It’s now a starting salary of £28k and an industry average salary of £35k. I am thankfully a high earner (over £60k) as I am in sales within the industry and earn a bonus, but most don’t. This has been the issue for the last 20 years at least, but salaries haven’t kept up. My industry has put starting salaries up but not middle salaries.

On the plus side it'll be written off earlier than you thought. So a nice suprise 😂
The government website is a bit rubbish with the way they phrase the write off section to be fair

Car tax isn't a tax because a car tax would be paid by all car owners, which would be fairer…

All graduates pay the same fees, whether up-front or after graduation.

Agree about the nursing degree; they made traditional nursing a lesser position (HCA etc) and made modern nursing a more clinical position.

That’s the worst news I’ve ever been given. Thanks for that 😭

I’m trying to work it out. I finished school in 2003 so a levels 03/4 and 4/5. I think I started sept 2005 so just missed out?!

On the plus side it'll be written off earlier than you thought. So a nice suprise

In my case, no. If I complete my degree, I will be 49 at the end of it. I did one year in 2022/23, then had to defer. However, although my degree is directly linked to a specific occupation at the end of it, I do not know yet how many hours a week I will want to spend doing it by the time I get to that age, so may well never earn enough to being repayments.

I also do not plan to work thirty more years, and from what I have read, repayments will stop when income drops below the threshold, which it absolutely will when I retire. For me, it will be a question of how much I have to pay back between graduation and retirement, which will be roughly 16 years or less - I hope!

Apologies, unfortunately it looks like if you started your course a year later in 2006, the student loan would be written off after 25 years after first payment was due. So if you finished the course in 3 years you would finish August 2009 and then first due payment April 2010, write off 2035. Whereas yours seems to be fixed at age 65 years.
If you go to your student loan account online and see if you can find the first statement it might help you check. But yeah from your info it sounds like you've got the worse one out of the plan 1 versions.

I came from a poor background and I didn't get a loan or had parents who could afford to pay it for me. I found a novel way to end up debt free by the time I graduated....I got a job!

I had a job but wouldn't have been able to afford my £9k tuition fees per year. What year did you got to uni, what were your tuition fees?

There is no job today for a student that would pay enough to pay for a whole degree before graduating, you must have graduated in 1992 or something well fucking done you

I find it very, very funny. Every few years I log in and see that the remaining balance has gone down by about £20. I just regard it as a tax that I pay for going to university, and that will eventually stop. They’re never going to get the full amount out of me and it would be very foolish of me to try and pay it off.
idiots!

I’ve just checked again. My remaining balance to pay in 2015: £25,240.
my remaining balance now: £25,280

Just missed out, but equally if you’d started in September 2006 your tuition fees would have been triple. Some people would benefit from a longer cut off period but smaller loan because they’re going to pay it off anyway, some people benefit the other way.

I went in 2006 and my tuition fees were 3k per year. I earned about £6-8k back then. It varied due to contracted time (part-time) and additional extra hours when short of staff.

I went in 2006 and my tuition fees were 3k per year. I earned about £6-8k back then. It varied due to contracted time (part-time) and additional extra hours when short of staff. I was at primary school in 1992!

I am glad I am not alone in thinking this, I said the same thing on here earlier.

I cannot get my head around the interest piling on, while repayments are put on hold until earnings hit a certain point, and even then it is a fixed 9% of the monthly salary over the threshold, with payments stopping if salary drops below the threshold (even though interest continues to build), with the ultimate result that a lot of it could all get written-off anyway.

Why allow people to rack up such huge sums in the first place, while allowing so much opportunity to never pay it back? Why can't it be, for example, a loan where a reasonable amount of interest begins to be added once the course is completed, with simple, straight-forward repayments for, say, the next five or ten years for everyone, regardless of their situation?

I started in 2012 and had £9k in tuition fees alone. I was earning about £7.5k a year and by the time I paid for travel to work and uni, paid board to my mom(would've been even more expensive to move to live near a uni) how would you suggest I could have left uni debt free? That was above minimum wage around 18.5hrs per week minimum. If I worked full time I would have got around £15k in wages a year but then I wouldn't have had the time to attend uni. So in 6 years, can you see how it could have gone from achievable to basically impossible to leave uni debt free without parents money?

Does anyone know how to find out the write off date? I know google shows it relates to the plan you are on… and what year you graduated. But what if your BA was finished in one year and then your masters in another year? When is it wiped from? TIA

This is irrelevant since you've now added the detail that you went years ago when fees were a third of what they are now and cost of living was lower.
I'm not sure why you bothered, My post clearly mentions the new style loans.
Students today are considerably worse off than your fortunate position.

"Why allow people to rack up such huge sums in the first place, while allowing so much opportunity to never pay it back? Why can't it be, for example, a loan where a reasonable amount of interest begins to be added once the course is completed, with simple, straight-forward repayments for, say, the next five or ten years for everyone, regardless of their situation?"

I think that way would put more people off going to university as it wouldn't have any affordability criteria built in. It'd be difficult for those on lower incomes (eg nurses) and those who are part time so on lower incomes (eg due to caring responsibilities, ill-health) and those who can't work (eg some disabilities and health conditions). At least the way it is, you only pay on income above (I think) £25,000.

Yes, @ShesTheAlbatross I very specifically didn’t take a gap year so I could get the cheaper tuition rate. Looks like I’ve ended up paying more to save less. Typical 🤣

I see these questions as orthogonal to each other. I'd answer "yes" to both.

I logged in and saw that some years the interest has matched my payments and this year so far the difference is about £30 in my favour, the year before last £200. At least it wasn’t as “just missed out” as I thought and was actually an entire year.

So how much have you got left to pay on your student loan? How much do you pay out of your wages and how much is the interest each month, you may pay it back before you're 65