PGCE completed as mature student - should I repay?

brizfil

I completed my PGCE in 2013 and started to repay my 1 year student loan last year. My question is whether, at the age of 43, it is worth me clearing the debt, as I now have the option to borrow the money interest-free from elsewhere (I also had a small bursary which I managed to save). Was hoping I could use the calculator to answer this question but it doesn't cover 1 year loans, any advice much appreciated (don't feel the Student Loans Company will be much help!).

Thanks

Steph

brummierebel

This is a marginal call and it depends what you think your career prospects are.

I think I looked at this a few years ago when I was thinking of doing a PGCE (I didn't in the end). I worked out very roughly that if you started at M1, and moved up the scales every year (which is no longer guaranteed) and then started moving through the UPS scales once every two years (which is the minimum possible), you would end up paying the loan back with interest. Therefore it would be cheaper to pay it off up front.

However as usual with student loans it is not that simple. It is not a normal debt which gets cancelled under certain conditions and you don't have to repay if you step out of work for a bit or earn under the threshold. So it depends on what you think will happen in your personal circumstances. I probably would not pay it off given the effective flexibility in the repayment terms that would not be available for a commercial loan but like many people I hate the idea of being it debt.

Personally, I don't think the government should charge tuition fees for those who enter public service or at the very least, should pay it back at over ten years if you stay in service. I suspect rip-off £9k tuition fees are putting quite a few people off teaching.