Student Loan - how can I avoid paying it back?

JimmyTheWig

I'm still not clear, but it is starting to sound like you want to pay less that you would have done if you received this money at the proper time.

I have no idea whether this is possible. I would like to think it isn't possible, as I don't see why you should be able to.

Firstly, cards on the table, I don't think anyone should have to pay back any of their student loans. I think education should be free for all. I think that a decent living grant should be reinstated, loans scrapped and fees abolished.
But that isn't what happens.

Many people like you are in the process of paying back their loans.
Many more like me have gone through the same process.
Note that with the interest on these loans being limited to the rate of inflation with no charges for the cost of processing, these loans are being subsidised by the government. The government is funded by the tax-payer, so the loans are being subsidised by all of us.
Like I say, I don't have a problem with this subsidy, and think it should be more of a subsidy, but I don't see why you should benefit more than someone else.

I can appreciate that it is hard having had to wait for three years to get the wages you deserve. Why not look at it from the point of view that the tax payer has had to wait three years to get the student loan repayments.

I don't know how the system works, but I would like to think that you will end up paying the same income tax, NI and loan repayment that you would have done if you received this money weekly / monthly at the right time.
If you are having to pay more than this then I think you have a right to complain about it. I would like to think that people on this site would be happy to help (where possible) you reduce this to the fair level.
But paying less than you should have done just isn't fair.

neas

no offence... but unless you have big debts other than the student loan.. i'd be happy to get my loan down faster.
Assuming its 9% off the 20k your owed... thats what 1,800 pound maximum you'd 'lose'... or 'repay'.

I'd rather repay loan and get rid of student loan :P. Soon we will head into inflationary times (5+% RPI) and your student loan will be 'going up alot'... so why not pay it off?

vaporate

neas wrote: »

no offence... but unless you have big debts other than the student loan.. i'd be happy to get my loan down faster.
Assuming its 9% off the 20k your owed... thats what 1,800 pound maximum you'd 'lose'... or 'repay'.

I'd rather repay loan and get rid of student loan :P. Soon we will head into inflationary times (5+% RPI) and your student loan will be 'going up alot'... so why not pay it off?

Because you are being charged £50 a month! At least me and my sister are.

Mine will be written off at age 65 so any spare money goes straight to my savings.

housebuyer_abc

vaporate wrote: »

Because you are being charged £50 a month! At least me and my sister are.

Mine will be written off at age 65 so any spare money goes straight to my savings.

Lovely - so much community spirit and morality...

And for the record I agree with an earlier poster Student Loans are wrong, the country should support it's students more, but it doesn't, and that isn't going to change in a long time, so for now thats just how it is

GBMatt

I had this problem, I had a backpay, not 20k but 3 months a new job hadn't paid me and the SLC worked out that was 1/12 of my annual income and charged me a fortune accordingly, but unlike tax where it is worked out at next paycheck over your tax code it is a loan payment and cannot be reclaimed. I reckon the best route would be to phone SLC before-hand and try to make some arrangement with them, otherwise if it comes through with wages then they assume that's your regular and take a chunk.

Matt.

Matt.

vaporate

housebuyer_abc wrote: »

Lovely - so much community spirit and morality...

And for the record I agree with an earlier poster Student Loans are wrong, the country should support it's students more, but it doesn't, and that isn't going to change in a long time, so for now thats just how it is

It's going to get worse too. According to sky news, student numbers will be cut and funding too.

Anyone remember this? Tony Blair: 50% of the younger population into HE.

I don't know whether to laugh or cry.

neas

vaporate wrote: »

Because you are being charged £50 a month! At least me and my sister are.

Mine will be written off at age 65 so any spare money goes straight to my savings.

Hmm... at this very moment I owe 10k.... i get charged £0.. a month because the RPI this year is 0%....

so... every bit of money i repay this year will pay it off. When you say 'charged £50 a month' maybe you mean you are paying back £50 a month to them... as interest is now 0%.... so you are paying £600 a year back to them.


Lets say for argument sake you pay 25 years... at £50 a month... you will pay back £15000.

What i always find amusing though with 'ex-students' and the 'why pay back' attitude is that they fail to factor in 'inflation'.

Inflation will cause your loan to go up... but over time your wage wil inflate.... inflate more and more past the 15k threshold. Now £15k a year is like a good admin job and you can survive off £15k....... in 10 years £15k will be what a mcdonalds worker gets paid... in 20 years £20k.. will be what a mcdonalds worker pays.

Either way the point is you will find as wages 'inflate'.. as you maybe 'progress' higher.. or stay 'under threshold' you will still pay back the majority of it... or as you say you will find you will pay back alot more than you thought... but becasuse of inflation it will have only halfed the debt :P.

Student loans cripple your future earnings by 9%.. so you either make a choice and get paid nothing... for 25 years.... and which you can just say.... 'why did you waste 3-4 years of your life at uni , if it got you less than 15k a year for 25 years of your life?'.... or you just live a normal life and then go 'oooh.... i've actually paid by my loan as i've got better and better jobs over time'...

Either you pay loan off and have better job.. or you have poor job... either way in terms of 'not paying student loan' vs 'paying student loan'.. i know which i'd want. Its like telling someone to remain under teh 40% tax limit so they won't pay as much tax.... but... they will earn 50% of that 'boost'. When your student loans paid off it will be like receiving a 9% pay rise.

ILW

JimmyTheWig wrote: »

Firstly, cards on the table, I don't think anyone should have to pay back any of their student loans. I think education should be free for all. I think that a decent living grant should be reinstated, loans scrapped and fees abolished.
But that isn't what happens.

I think that would be a great idea, as long as you want to pay it for them Jimmy.

McKneff

Education is free for all, until the student makes personal choices,
In that case, they should pay for those personal choices.

Fiddlestick

McKneff wrote: »

Education is free for all, until the student makes personal choices,
In that case, they should pay for those personal choices.

The OP took the student loan on knowing full well what the terms and conditions of repayment were in advance.

If this lump sum is backdated pay that SHOULD have been put through PAYE on a monthly basis and SHOULD have been assessed for student loan payments then yes, you do indeed have to pay the contributions as that's only fair.

What might happen through is that HMRC see it all as one month's income and pro-rate that to an annual income and deduct a whopping great wodge, in which case you write to them with evidence that it's a salary settlement and ask them to adjust the deduction accordingly.

In short, make sure you pay what you owe - no less but no more.