Facing up to Student Debt - Advice on SLs needed please

lady_fuschia

I wouldn't exactly say don't worry about your student loan, but I would say don't worry unduly about it. You don't get into any trouble for not paying it, it gets written off eventually if you don't- no-one is going to send you a demand letter asking for a scary amount its impossible to pay. So its nothing to lose sleep about in the same way as , say, a credit card debt. If you're in a situation where you're not earning enough to make minimum repayments and don't have a lot to spare, I would concentrate on keeping yourself fed and with a roof over your head- don't let the student loan add to your worries, no-one's going to be chasing you with a big stick for this one!
However, obviously, if you are in a position where you do have extra money to overpay, then by all means do. The mental freedom you will get from being able to say you are debt free sooner rather than later is priceless. It sounds like this is something that preys on your mind, so it's best that if you can, you do. Some people are comfortable with a debt hanging over their heads provided they know it will be written off at 65 or when they die and they won't get taken to court for it. Some people aren't- if you're the second type, its best that you pay what you can just for your own peace of mind.

Snich

Hi,

Just my tuppence-worth...
I don't like debt and have £17,000 worth of student loan at 3.2%. I'm a basic rate taxpayer (just) and pay just over 100 pounds per month out of my paycheque (which, incidentally starts the April AFTER your degree ends).

I want to overpay my loan to get rid of it, but also need some cash savings SO I am choosing to fill up an ISA with 3000 per year and then using the rest of my money to overpay my loan. (I am living off less than 50% of my salary with all the rest going to overpayments)

Just a way of showing that there is another way of doing it (although each to their own as demonstrated above!)

Good luck! At least find out how much you owe - it's a very good motivator!

Snich x

dickybeau

lady_fuschia wrote:

So its nothing to lose sleep about in the same way as , say, a credit card debt. If you're in a situation where you're not earning enough to make minimum repayments and don't have a lot to spare, I would concentrate on keeping yourself fed and with a roof over your head- don't let the student loan add to your worries, no-one's going to be chasing you with a big stick for this one!

This only applies if you have no arrears and remember to defer on time. SLC won't reduce the debt or stop interest being charged in the way that banks and credit card companies will. If you forget to defer and don't make minimum payments, the arrears are pursued vigorously even if you subsequently defer. SLC will not accept that banks or credit cards will get priority over your student loan.

cookiesncream

dickybeau wrote:

This only applies if you have no arrears and remember to defer on time. SLC won't reduce the debt or stop interest being charged in the way that banks and credit card companies will. If you forget to defer and don't make minimum payments, the arrears are pursued vigorously even if you subsequently defer. SLC will not accept that banks or credit cards will get priority over your student loan.

Although there are people on this thread who this applies to. I think the poster was referring to the OP who will have the new PAYE system. I realise that all debt is debt, but there's no need for what I think is too much of a negative response.

I'm just about to start studying medicine, so will run up huge SLs no doubt. It scares me in one way to have the amount of debt but I know that if I'm not earning enough, then I don't have to find the money for it because I won't have to pay. Plus there's the added advantage that you don't have to worry about making the payments because it's all worked/taken out for you and you never see the money.

I will now be looking into the ISA/overpayment option though. Thanks guys :beer: