Student Loan Dilemma

GregoryS

Hi everybody,

My name is Greg, I'm 34 and I'm a Brit living abroad in France. I am trying to get more responsible and active about managing my finances (saving, starting a pension, managing debts, etc) but I am already hitting a stumbling block in the form of the decision whether or not it is wise to start repaying my student loan.

Here are my circumstances :
I have a debt to the Student Loans Company of £16,665 from loans I took out in 2001 and 2005 for two separate courses.
I moved to France to study and then found a place to live and some temporary work but I am currently unemployed. I will receive an unemployment benefit but I fully intend to find work asap.
I have submitted my unemployed status proofs to the SLC and I expect to be made exempt from obligatory repayments for 1 year.
I have about £5000 of savings but a good proportion of this will be needed to pay for rent and living costs over the future.
I am not dependant on any member of my family.

I want to be proactive about tackling the debt and I had planned to start paying it off immediately through voluntary payments in the hope that I will be back in full-time employment soon. After having talked to my cousin however, I was somewhat put off the idea. He repaid a substantial amount but then found himself unable to continue and during the period that followed his repayments were eaten up by the interest on the loan. I can't afford to waste any of my savings doing this too.

I feel like two scenarios present themselves with my student debt : 1) I may never earn over the threshold up until I hit 65 when the debt will be wiped off so any repayments are redundant but it's a very long time to wait or 2) I will (and very much hope to) earn over the threshold and some point so it would be nice to start attacking the sum total now and thus keep the interest rate down at least.

I would also like to plan and save for the long-term future. I can see that, given my current circumstances, I am asking a great deal but I would like to start by outlining a financial plan for the future, then take the action required to reach my goals.

Could anyone please advise me on a strategy for dealing responsibly with the debt and then putting myself in a position to start saving for the future?

Thank you all very kindly,

Greg.

[Deleted User]

Greg hi and welcome to mse, personally I think your first priority must be to find work and then work on your plans going forward.