How Long To Clear Student Loan?

JayOne

Hi,

I finish University this year and I'm in a fair bit of debt. I'm a little bit worried that I will forever live in the debt of being a student.

I'll get around 22k a year once I find a job, so I'm wondering roughly how long am I looking at to be debt free?

I know nobody can give definitive answers, but just some guess from others who have been students in debt.

Thanks for any advice. It gets a little worrying at times. After paying tax and debts Ill probably be looking at 17-18k a year which isn't what I was expecting really.

ElmerFudd

Hi JayOne. To be honest it depends on how much you owe totally, the Student loan APR, how much you will be earning, and how much they will be charging you once you earn that amount.
I still have pre 1997 loans that I have deferred til this year, roughly eqauted to £8k. These I will finish paying in 5 years, at £165 a month.

davetrousers

You seem fairly confident about getting this £22k a year salary.

JayOne

davetrousers wrote: »

You seem fairly confident about getting this £22k a year salary.

I'm probably thinking to far ahead. Most jobs in my area of work (web development) are between 18k and 30k depending on experience. I think I'll be on the low end of the salary at first (probably less than 18k) until I can prove myself which I'm confident about.

Saying that, I have to get a job first.

University isn't all it's cracked up to be when you have to live with lots of debt and the possibility of not even getting a job.

dreamdreamer

As a guideline: I've been in full-time work and paying back my loan for 5 years since I left university. I earned about £16k when I started and that's risen to just under £27k after promotions, although I also do overtime which probably raises my salary to around £31k. My £12k loan will be paid off in 2017 - 12 years after I graduated.

At £22k salary a year, assuming an APR of 1.5% (which it is now) a £12k loan (at £52 a month) would take 22 years and a £15k loan (at £52 a month) would take 30 years.

However you have to consider both that interest rates might change, and that your salary will rise (hopefully!).

david_hellier

Forget worrying about student loans. Treat it like a tax.

MessyMare

In the two years I earned enough to make payments, the amount they took didn't even cover the monthly interest payments (when it was accruing interest). Now I'm back below the threshold so lord knows when it'll be paid off, if ever!

brokeinlondon

I agree with mr hellier, the APR and repayment amount on my student loans are so small compared to what i owe (approx £14k) that i don't even think of it as debt any more. it doesn't even show on your credit file (whilst it's up-to-date, not sure what happens when you're unfortunate enough to owe SLC money)