Student loan, increase pension payments?

Baldytyke88

My daughter is 24 and in her first year as a qualified teacher. I don't know much about student loans, but they are in the news much more.

She is not thinking about her pension at her young age, but I believe she earns around £35k. Would someone earning £35k be paying off a student loan and would it make sense to increase pension contributions in order to keep below the limit where student loans are repaid?

la531983

As a teacher she certainly should be thinking about a pension, would be one of the best schemes available to her!

Dazed_and_C0nfused

https://forums.moneysavingexpert.com/discussion/comment/81867080#Comment_81867080

Hopefully she is already in TPS and this would just additional contributions

Baldytyke88

https://forums.moneysavingexpert.com/discussion/comment/81867085#Comment_81867085

Would it be easy to increase her contributions to take her below the level at which contributions start? Is it worthile, as the rate is 9%

As of the 2024/25 tax year, the repayment threshold for Plan 2 (post-2012) loans is £27,295, but this varies by plan type (e.g., Plan 5 for new students has a higher threshold of £25,000 as of 2026/27)

Marcon

https://forums.moneysavingexpert.com/discussion/6653455/student-loan-increase-pension-payments

If she's teaching in the state sector she is entitled to membership of the TPS so hopefully she's joined it.

Pension contributions won't have any impact on the salary on which her loan repayments are calculated (she won't be able to make them by salary sacrifice if she's in the TPS).