Latest news with #StudentLoansCompany
Yahoo
22-05-2025
- Business
- Yahoo
Labour to ban over-60s from taking out student loans
Did you go to university in your 60s? We want to hear if it was a success or not. Get in touch with us money@ Labour is set to ban over-60s from taking out student loans after taxpayers were saddled with £50m in unpaid debt. A shake-up of higher education funding in England will end a clause which allows older learners to take out loans which they are unlikely to ever repay. Last year, more than 1,000 students over the state pension age of 66 took money from the Student Loans Company (SLC) to cover their fees, data provided to The Telegraph under Freedom of Information rules revealed. More than 3,800 students over the age of 60 took loans, with 1,824 also taking out maintenance loans. Since 2020, 18,127 loans have been taken by students over the age of 60. This means that some pensioners could have received as much as £15,829 in government support, with a full maintenance loan on top of a full new state pension. The outstanding balance for those over 60 was £49,011,160. It comes as Labour doubles down on a Sunak-era commitment to ban those over the age of 60 from taking money from the Government to pursue degrees. The 'Lifeline Learning Entitlement' will replace the existing higher-education funding system and will provide all new learners with a tuition fee loan entitlement to the equivalent of four years of post-18 education. A spokesman for the Department for Education said: 'From January 2027, tuition fee loans will no longer be available to those aged 60 and over.' Tom Allingham, of Save the Student, which provides financial advice to undergraduates, said: 'While the current system creates a generational divide – students aged 60-plus are far less likely to repay their loans, so for many, their degrees are effectively free – we believe the decision to limit student loans to the under-60s only is a step backwards, as it makes it much more difficult for older students to pursue higher education. 'Instead, we believe tuition fees should be abolished, allowing students of any age to gain a degree free of charge.' Student loans can be taken out to cover tuition fees – which are set to rise to £9,535 in September – and living costs. The amount that can be borrowed depends on the financial situation of the student in question, and the loans are not repaid until graduates earn over a certain threshold. This means that those aged more than 60 when they take out loans are unlikely to repay their debt at all – unlike those who complete their studies when they're younger. The average graduate in England last year was £48,470 in debt when they started repaying their loan. The ten most indebted students owe a collective £2.7m, with one on the hook for nearly £300,000 for their studies. Liz Emerson, of the Intergenerational Foundation think tank said: 'While lifelong learning should be open to all who have never been able able to access higher education before, there is an obvious intergenerational unfairness if younger generations have to continue to pick up the bill for these older students who will obviously never pay back their student loans. 'This is another subsidy from young to old.' Approximately £20bn a year is loaned to 1.5 million students, according to a briefing by the House of Commons. The value of outstanding loans is forecast to hit £500bn by the late 2040s, government predictions show. Debts to the SLC are wiped entirely after either 30 or 40 years, depending on when the loan was taken out. A Department for Education spokesman said: 'This Government is committed to boosting opportunity and economic growth by building a skilled workforce, while ensuring the student finance system remains fair and sustainable.' 'The dire situation we inherited has meant this Government must take tough decisions to put universities on a firmer financial footing, so they can deliver more opportunity for students and growth for our economy through our Plan for Change.' Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
Telegraph
22-05-2025
- Business
- Telegraph
Labour to ban over-60s from taking out student loans
Did you go to university in your 60s? We want to hear if it was a success or not. Get in touch with us money@ Labour is set to ban over-60s from taking out student loans after taxpayers were saddled with £50m in unpaid debt. A shake-up of higher education funding in England will end a clause which allows older learners to take out loans which they are unlikely to ever repay. Last year, more than 1,000 students over the state pension age of 66 took money from the Student Loans Company (SLC) to cover their fees, data provided to The Telegraph under Freedom of Information rules revealed. More than 3,800 students over the age of 60 took loans, with 1,824 also taking out maintenance loans. Since 2020, 18,127 loans have been taken by students over the age of 60. This means that some pensioners could have received as much as £15,829 in government support, with a full maintenance loan on top of a full new state pension. The outstanding balance for those over 60 was £49,011,160. It comes as Labour doubles down on a Sunak-era commitment to ban those over the age of 60 from taking money from the Government to pursue degrees. The 'Lifeline Learning Entitlement' will replace the existing higher-education funding system and will provide all new learners with a tuition fee loan entitlement to the equivalent of four years of post-18 education. A spokesman for the Department for Education said: 'From January 2027, tuition fee loans will no longer be available to those aged 60 and over.' Tom Allingham, of Save the Student, which provides financial advice to undergraduates, said: 'While the current system creates a generational divide – students aged 60-plus are far less likely to repay their loans, so for many, their degrees are effectively free – we believe the decision to limit student loans to the under-60s only is a step backwards, as it makes it much more difficult for older students to pursue higher education. 'Instead, we believe tuition fees should be abolished, allowing students of any age to gain a degree free of charge.' Unpaid debt Student loans can be taken out to cover tuition fees – which are set to rise to £9,535 in September – and living costs. The amount that can be borrowed depends on the financial situation of the student in question, and the loans are not repaid until graduates earn over a certain threshold. This means that those aged more than 60 when they take out loans are unlikely to repay their debt at all – unlike those who complete their studies when they're younger. The average graduate in England last year was £48,470 in debt when they started repaying their loan. The ten most indebted students owe a collective £2.7m, with one on the hook for nearly £300,000 for their studies. Liz Emerson, of the Intergenerational Foundation think tank said: 'While lifelong learning should be open to all who have never been able able to access higher education before, there is an obvious intergenerational unfairness if younger generations have to continue to pick up the bill for these older students who will obviously never pay back their student loans. 'This is another subsidy from young to old.' Approximately £20bn a year is loaned to 1.5 million students, according to a briefing by the House of Commons. The value of outstanding loans is forecast to hit £500bn by the late 2040s, government predictions show. Debts to the SLC are wiped entirely after either 30 or 40 years, depending on when the loan was taken out. A Department for Education spokesman said: 'This Government is committed to boosting opportunity and economic growth by building a skilled workforce, while ensuring the student finance system remains fair and sustainable.' 'The dire situation we inherited has meant this Government must take tough decisions to put universities on a firmer financial footing, so they can deliver more opportunity for students and growth for our economy through our Plan for Change.'
Telegraph
14-05-2025
- Business
- Telegraph
The British graduates with the highest student debt
The 10 graduates with the biggest student debt in Britain owe a collective £2.7m, figures show. The single most indebted student owes the Government nearly £300,000 for courses started in January 2012. All 10 were more than £250,000 in debt for courses beginning between 2010 and 2015, data released to The Telegraph by the Student Loans Company (SLC) under Freedom of Information rules revealed. Experts said that the graduates were likely to have done long courses or multiple degrees, as well as having faced high interest rates. Student loans can be taken out to cover tuition fees – which are set to rise to £9,535 in September – and living costs. The amount that can be borrowed depends on the financial situation of the student in question, and the loans are not repaid until graduates earn over a certain threshold. The average graduate in England last year was £48,470 in debt when they started repaying their loan. Approximately £20bn a year is loaned to 1.5 million students, according to a briefing by the House of Commons. The value of outstanding loans is forecast to hit £500bn by the late 2040s, government predictions show. This is in part because of the interest rate structure on higher earners. Those who started their degrees in 2012 have so-called 'Plan 2' loans, which sees them charged the retail price index (RPI) plus up to three percentage points, and start making repayments once their salaries exceed £28,740. For anybody earning between £28,470 and £51,245, the interest rate increases gradually from 4.3pc to 7.3pc – the higher the salary, the higher the interest rate. Anybody earning over £51,245 is charged the maximum interest rate of 7.3pc. Sarah Coles, of investment platform Hargreaves Lansdown, said: 'It's really unusual to have an outstanding loan balance of £250,000 or more. It will usually mean someone has studied a number of courses in order to rack up the debts. It's also likely to include plenty of interest.' She said that the changes made to student loans in 2023 would mean students pay back more on lower salaries. Those on Plan 5 loans begin repayments at £25,000, and will not have their debt wiped for 40 years. Ms Coles said: 'We have moved from a system where only 27pc of people repaid in full, to one where 65pc of people do. And because they carry it for the longest, upper middle earners will repay the most.' Tom Allingham, of campaign group Save the Student, said: 'The amounts exposed by this data are eye-watering.' Mr Allingham said that even though a graduate could owe as much as £300,000, the repayment terms on student loans would not change. He said: 'The size of your debt has absolutely no impact on the amount you repay each month. Your debt could be £300,000 or £300, but you'd still only repay the same 9pc of your salary over the threshold.' The campaigner said that because of the lower interest rates on the new Plan 5 loans, it was unlikely that future graduates would see debts as large as current graduates. Those who began their courses from 2023 will pay only RPI on their loans. He said: 'Future graduates will see their loan balance grow more slowly than those in the past, and never have to repay more than they borrowed in real terms.' One way that graduates are avoiding repaying the SLC is by moving abroad. Figures show the body is trying to trace 112,000 'runaway' graduates who live overseas and are not actively repaying their loans, including 73,000 UK natives. They have a total outstanding loan balance of £2bn – or £27,000 each. Tuition fees were introduced by Tony Blair in the 1990s, and initially sat at just £1,000 a year and then £3,000 from 2006. The coalition government controversially tripled fees to £9,000, despite a Liberal Democrat manifesto pledge to do away with the charges. The fees then rose to £9,250 in 2017, and will increase to £9,535 later this year, an increase of 3.1pc. A Department for Education spokesman said: 'These balances are not typical of the vast majority of graduates. 'It is vital that students can be confident the significant investment they make in higher education delivers real value for money and that universities provide teaching and an experience they deserve, to help students pursue a rewarding career. 'It's also important we have a sustainable student finance system that works for both students and taxpayers.'
Rhyl Journal
21-04-2025
- Business
- Rhyl Journal
Martin Lewis Student Loan issue after minimum wage rise
Those with student loans may now be tipped into the repayment threshold if they work full time. In a tweet, he raised the issue of the plan 5 student loan repayment threshold, which starts at £25,000 a year. He said: "A full time worker doing 40hrs a week on the new increased £12.21/hr minimum wage would earn just over £25,000. The Plan 5 student loan repayment threshold (ie English students who started uni since 2023) is £25,000 and is frozen until 2027. "So in the April after those graduates leave uni, even on min wage jobs, they'll now often need to start repaying (a little) bit of their student loans." He added in a follow up: "Many people saying 'it's the interest rates that are the killer' actually that's not true. These new Plan 5 loans interest is set at the rate of inflation, that seems good but it distracted from the killer changes to this cohort of students. "The repayment threshold was lowered to £25,000 so people start repaying on lower incomes. Repayments last 40 years not 30 years. "For many this effectively increased what they'd likely repay by very roughly around 50% (barring very high earners who'd repay less due to lower interest and the fact they'd have cleared early anyway). It was a huge stealth rise that many missed, as it's tough to explain and people focus on tuition fees (the recent rise in which had trivial impact compared to these changes)." You could be owed money by the Student Loans Company🚨 Managed to bag yourself a refund? Let me know👇🏻 This varies, but graduates only repay when their income is over the threshold amount for their particular repayment plan, unless they've been overpaid. Their income is the amount they earn (including things like bonuses and overtime) before tax and other deductions. The threshold amounts change on April 6 every year. The earliest they start repaying is: Repayments automatically stop if either: The threshold is over £501 a week, £2,172 a month or £26,065 a year. The threshold is over £547 a week, £2,372 a month or £28,470 a year. The threshold is over £629 a week, £2,728 a month or £32,745 a year. The threshold is over £480 a week, £2,083 a month or £25,000 a year. For a Master's Loan or a Doctoral Loan, the threshold is over £403 a week, £1,750 a month or £21,000 a year. The Student Loans Company (SLC) will write to anyone who has been paid more student loan or grant than they're entitled to. They must repay this separately from the rest of their student loan. Very much yes. And many people have. You can ask for a refund if: HM Revenue and Customs (HMRC) will tell your employer to stop taking repayments from your salary when you have repaid your loan in full. It can take around 4 weeks for salary deductions to stop. This means you may pay back more than you owe. You can avoid paying more than you owe by changing your payments to Direct Debit in the final year of your repayments. Martin Lewis: Biggest factor to change mortgage rates Martin Lewis shares 'what to do' as energy bills set to increase 6.4 per cent Martin Lewis Energy Price Cap warning If you have paid too much the Student Loans Company (SLC) will try to: If you've overpaid and have not heard from SLC you can ask them for a refund.
North Wales Chronicle
21-04-2025
- Business
- North Wales Chronicle
Martin Lewis Student Loan issue after minimum wage rise
Those with student loans may now be tipped into the repayment threshold if they work full time. In a tweet, he raised the issue of the plan 5 student loan repayment threshold, which starts at £25,000 a year. He said: "A full time worker doing 40hrs a week on the new increased £12.21/hr minimum wage would earn just over £25,000. The Plan 5 student loan repayment threshold (ie English students who started uni since 2023) is £25,000 and is frozen until 2027. "So in the April after those graduates leave uni, even on min wage jobs, they'll now often need to start repaying (a little) bit of their student loans." He added in a follow up: "Many people saying 'it's the interest rates that are the killer' actually that's not true. These new Plan 5 loans interest is set at the rate of inflation, that seems good but it distracted from the killer changes to this cohort of students. "The repayment threshold was lowered to £25,000 so people start repaying on lower incomes. Repayments last 40 years not 30 years. "For many this effectively increased what they'd likely repay by very roughly around 50% (barring very high earners who'd repay less due to lower interest and the fact they'd have cleared early anyway). It was a huge stealth rise that many missed, as it's tough to explain and people focus on tuition fees (the recent rise in which had trivial impact compared to these changes)." You could be owed money by the Student Loans Company🚨 Managed to bag yourself a refund? Let me know👇🏻 This varies, but graduates only repay when their income is over the threshold amount for their particular repayment plan, unless they've been overpaid. Their income is the amount they earn (including things like bonuses and overtime) before tax and other deductions. The threshold amounts change on April 6 every year. The earliest they start repaying is: Repayments automatically stop if either: The threshold is over £501 a week, £2,172 a month or £26,065 a year. The threshold is over £547 a week, £2,372 a month or £28,470 a year. The threshold is over £629 a week, £2,728 a month or £32,745 a year. The threshold is over £480 a week, £2,083 a month or £25,000 a year. For a Master's Loan or a Doctoral Loan, the threshold is over £403 a week, £1,750 a month or £21,000 a year. The Student Loans Company (SLC) will write to anyone who has been paid more student loan or grant than they're entitled to. They must repay this separately from the rest of their student loan. Very much yes. And many people have. You can ask for a refund if: HM Revenue and Customs (HMRC) will tell your employer to stop taking repayments from your salary when you have repaid your loan in full. It can take around 4 weeks for salary deductions to stop. This means you may pay back more than you owe. You can avoid paying more than you owe by changing your payments to Direct Debit in the final year of your repayments. Martin Lewis: Biggest factor to change mortgage rates Martin Lewis shares 'what to do' as energy bills set to increase 6.4 per cent Martin Lewis Energy Price Cap warning If you have paid too much the Student Loans Company (SLC) will try to: If you've overpaid and have not heard from SLC you can ask them for a refund.
