Student Loans...

S

Super P

New Member
Right people. Need some advice as you're all 30 something post graduates who must know answers, the student loans people are absolutely terrible and won't help me at all...

So I owe like £18,000 from my student loan. The only statement I have is from when I wasn't paying it off and the interest was 2.5%. I now am, just through PAYE and I think it might be 0% because I'm paying it off currently. Right, so I have a bit of money which I was gonna do a big payment off of this, but then I was just reading moneysupermarket.com who say that it's pointless and just to put it in a decent savings account.

What should I do peoples ?! Or more so, what did you do ?!
 
I paid mine off ahead of time. Besides the joy of being debt free, it insulates you against future rate hikes.

In my humble (but correct) opinion, the meager amount you earn on UK savings accounts right now (judging by my HSBC account) isn't quite enough to justify the idea of keeping your loan around just to make a few more pennies in a savings account.
 
I have no experience of student loans, I was sent out to work int' mill when I was 15.

Personally I see absolutely no benefit from paying a lump sum off your loan if you currently enjoy 0% apr, regardless of savings interest rates (you should get 3% in an instant access isa?). The government is currently squandering billions and billions of taxpayer money, why give them any extra help.

Possible scenario. You pay off a lump of your loan. One month later you need access to a wedge, you car was smashed up, a n other unforseen reason. You go cap in hand to the greedy finance houses who then charge you 10% for a loan.
 
Here you go Polly:

http://www.slc.co.uk/statistics/facts and figures/index.html

Can't see the point in you paying it off if there's any possibilty you might need access to credit any point after.

I presume you are in the post 1998 category, although as pre-1998 loaners will be paying -0.4%, if you weren't my advice would be the same unless you had cash on the hip to lump it off and avoid any future interest.
 
Whilst the financial benefit of not paying off your loan and investing the money elsewhere has significantly declined in recent years, I agree with others that you may as well keep the cash.

At the moment inflation is very low, so the amount of interest on student loans is negligible. Even if you only get 3% on a savings account it's probably still worthwhile having the cash 'in hand'.

Only arguements against this are if you want the feeling of being 'debt free' or you are applying for a mortgage/credit card/etc and you think the additional debt will count against you.
 
Let me get this straight, you've got a wad of cash, you've just finished Uni, and the best thing you can think of doing with it is paying off an (effectively) interest free loan?

The youth of today :spank:

(As an aside, when I was at uni all the rich brigade from North London all blagged the max loans they could purely for the investment opportunity)
 
Dan x said:
Let me get this straight, you've got a wad of cash, you've just finished Uni, and the best thing you can think of doing with it is paying off an (effectively) interest free loan?

The youth of today :spank:

(As an aside, when I was at uni all the rich brigade from North London all blagged the max loans they could purely for the investment opportunity)
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:lol::lol::lol::lol:
 
Hmmm, yeah. I'm post 1998 but I saw that page too and I'm not sure if I am on 0% as the SLC basically save money by doing no admin or anything and only update everything once a year so according to them I'm still at 2.5% but interest can beat that. But you are all right, as much for giving me available capital as for the measly interest I'll be able to earn. So I'm whacking it in an ISA with NatWest now.

And for the record, I'm spunking money happily enough, just have some money to put away somewhere. The youth of today can spunk money better than anyone I tell thee.

The only other option for would to put it all on black 4, not advisable.
 
Super Polack said:
While I'm at it... I can claim tax back for an ISA yeah ?! Do I just do a tax return ?!
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My recommendation: Pay it off. God,the amount that you can make at the moment in the bank is insignificat.

When I paid off my student loan (about 6 years ago when I appreciate terms are different) I got such a buzz (mind you I was paying Clydesdale bank a ridiculous amount - do not get me started)..being debt free has now made me a millionare believe it or not.

Surely if you are a student over the past year you would know being in credit is not the way...

DEBT AND LIFE FREE MATE
 
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freakstar said:
My recommendation: Pay it off. God,the amount that you can make at the moment in the bank is insignificat.

When I paid off my student loan (about 6 years ago when I appreciate terms are different) I got such a buzz (mind you I was paying Clydesdale bank a ridiculous amount - do not get me started)..being debt free has now made me a millionare believe it or not.

Surely if you are a student over the past year you would know being in credit is not the way...

DEBT AND LIFE FREE MATE
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^^ What he said
 
freakstar said:
My recommendation: Pay it off. God,the amount that you can make at the moment in the bank is insignificat.

When I paid off my student loan (about 6 years ago when I appreciate terms are different) I got such a buzz (mind you I was paying Clydesdale bank a ridiculous amount - do not get me started)..being debt free has now made me a millionare believe it or not.

Surely if you are a student over the past year you would know being in credit is not the way...

DEBT AND LIFE FREE MATE
Click to expand...

disagree.. I don't see the loan as debt, it's more like a tax which you only pay off when you can.

It certainly doesn't affect your ability to borrow either.

As the others say, better to invest the money elsewhere.
 
Ferd said:
disagree.. I don't see the loan as debt, it's more like a tax which you only pay off when you can.

It certainly doesn't affect your ability to borrow either.

As the others say, better to invest the money elsewhere.
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Nonsense, a tax? A loan needs to be paid back at some point. Coincidently I watched the ENRON movie earlier today. Have a clean slate and invest with your own cash. Clearly there is an issue if you can make cash from the taxpayer (I can not blame you) however, the gain is minimal. Your own mental thoughts about being debt free is the way to go.


CLEAR YOUR BLOOMING DEBTS
 
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ferd said:
disagree.. I don't see the loan as debt, it's more like a tax which you only pay off when you can.

It certainly doesn't affect your ability to borrow either.

As the others say, better to invest the money elsewhere.
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give me strength... I may well see you down cafe del mar having a cocktial this and next year but what about the year after? By that point, you will be sunk in debt with nowhere to go.

Look, you are in the fortunate position to do something now, do not do what i would do a put it all on black!
 
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