helping you save cash

Should I Worry About Repaying My Student Loan?

It’d been over a decade since I graduated.

My degree was a great thing to achieve but it didn’t really help me in my career going forward. I work for myself now and I often wonder whether if I’d just gone straight into work if much would be different.

Anyway, I keep getting letters every year (to my old address even though I’ve asked them to update it twice!) saying how much I now owe on my student loan.

It’s a terrifying amount, one which I know I’ll never pay off. I wonder whether I should begin paying it, but the amount I could afford to pay wouldn’t even touch the interest rates.

How it works is that you repay 9% of everything you earn over £25k. For instance, if you earned £30k, you’d pay 9% of £5k, which is £450.

The good news is that, eventually, it will all get wiped. After 30 years (or 35 in my case I believe!) after you graduate, it gets wiped.

So, don’t get worried about it. If you’re earning enough to pay it off you’re probably in a decent financial state in terms of income. If you’re earning less than the amount needed to start repayments, just see it as some cash you owe that you’ll probably never have to pay back. It doesn’t affect your credit score either.

Enjoy your student days & whilst making sure you’re sensible, don’t get too bogged down in the finance side of it.

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