Should I repay my loan asap?

Frogsarenice

First post on MSE... please be kind!

I'm 34 and Scottish but I studied for a graduate-entry medicine degree in England, racking up £35K in debt from SLC since 2012.

I came back to Scotland and started as a Junior doctor in August, on £23K a year plus shift allowance (probably equated to about £28K). I have started paying back student loan this April (though it won't show on the SLC repayments til next April- hate that they don't give it to them til the end of the year!).

My question is yes, I am a junior doctor so *hopefullt* my salary will go up and I will earn more in future. However, I am 34, and no spring chicken, though I'm pretty sure rhe government will have me working til I'm 70.

I would also like to go abroad for a year at some point in my career.

Should I try to overpay my loan and pay it off as quickly as possible?

Or should I just ignore it?

How do you even go about getting financial advice?

I don't come from a family of doctors or anyone with student loans and all my junior doctor pals went to uni in Scotland and so no debt.

If it is wise to pay it off should I take a bank loan with a fixed period of say 7years and lower interest (current slc interest is 4.6% and set to rise, when a bank loan I could get for around 3%).

Also I swear there was a rule originally that when you were 50 your loan got wiped... is this not true anymore?! (Wishful thinking):o

Sorry...maths is not my strong point!


(Also I am gutted that I didn't just study in Scotland as it would have been free for me, and I would have taken a bank loan for maintenance support- I originally thought it would be cheaper to go to England and pay fees and get a student fee&maintenance loan as "it's cheaper than a bank loan". I had taken a loan for first degree and paid it off and didn't realise interest calculations on loans had changed since then. What an eedjit:eek:)

Frogsarenice

Also, I have virtually no pension, and have just started an NHS one. Would it be better just overpaying into a pension instead of over-repaying my loan?

silvercar

In simplistic terms, I would:

1. start paying into your NHS pension
2. start building a savings pot
3. consider whether you will want to buy your own home, you will need a deposit
4. If 1-3 are sorted and you have spare cash each month, then over pay your student loan.


Downside of taking a bank loan is that you will have to meet the repayments on it, which will be higher than you repay on your student loan initially, even if money was ever tight. So having the bank loan may mean that you couldn't afford to go abroad. Whereas the student loan stops if you have no income for a time.

Frogsarenice

Thanks for your reply.

I think it's only worth overpaying my loan if I plan to pay it off? Otherwise will be overpaying into nothingness? Yes the only thing good about the student loan is if I lost my job/ became unwell, I could stop paying it. However if I really beasted myself for 7 years i could perhaps pay off my student loan, and in that case itmay be worth taking a bank loan instead as less interest? Or if I am going to put aside money for repayments, it may be more worthmy while putting it into my pension.

I also worry that the government will change the goal posts again and say no the loan won't get written kff after 30years... and I hate having debt. I repaid my first studwnt loan (all £12k) of it asap, hence optifnout of all pension schemes and thus having no pension so far...

Have been lucky in terms of a house as just bought one last year with my boyfriend. He paid the deposit, I pay the mortgage (so far).