Should I pay my student loan off?
Discussion
Could anybody offer opinions on whether it's sensible to pay off my student loan. I did an MSc full time starting in Autumn 2020, taking out a postgrad loan of around £11k.
Current outstanding balance is £8900.
Interest rate is 7.3% (it's higher for postgrad loans).
Current repayments (deducted at source) is £160 per month.
I'm just about to turn 57, with no plans to retire early.
If I were to pay it off, I'd have to sell some shares, which is another question - some have done very well, some not so much. My very simplistic forecast, based on loads of no doubt dodgy assumptions, is that I'll pay the loan off in about four years' time if everything continues as it is (which of course it probably won't). Given that my balance has reduced by £2k in the last four years or so, I'm pretty sure my simple forecast is way off. I just wonder if I could make better use of the £160 per month?
Thank you all in advance for the free financial advice! (I'm not averse to paying a financial advisor if you think that's the best course of action, I just thought I'd ask here first).
Current outstanding balance is £8900.
Interest rate is 7.3% (it's higher for postgrad loans).
Current repayments (deducted at source) is £160 per month.
I'm just about to turn 57, with no plans to retire early.
If I were to pay it off, I'd have to sell some shares, which is another question - some have done very well, some not so much. My very simplistic forecast, based on loads of no doubt dodgy assumptions, is that I'll pay the loan off in about four years' time if everything continues as it is (which of course it probably won't). Given that my balance has reduced by £2k in the last four years or so, I'm pretty sure my simple forecast is way off. I just wonder if I could make better use of the £160 per month?
Thank you all in advance for the free financial advice! (I'm not averse to paying a financial advisor if you think that's the best course of action, I just thought I'd ask here first).
Does it get written off at any age?
If not, I’d be inclined to clear it.
£160pcm is under £2k pa, so you are not clearing £8,900 in less than 4-5 years.
Our son had something similar - 7.3% is a frankly outrageous rate.
We were in the position to help him clear it - positioned it as inheritance come early.
Not sure you need a paid-for financial advisor to help you: only you can decide whether the money you would use can earn you more than 7.3%. I’d be surprised if it could, in any guaranteed way….& the knowledge you are £160pcm better off will be reassuring.
My personal choice would be to invest in low cost global tracker.
All the opinions of a stranger on the internet - suggestions, not advice
If not, I’d be inclined to clear it.
£160pcm is under £2k pa, so you are not clearing £8,900 in less than 4-5 years.
Our son had something similar - 7.3% is a frankly outrageous rate.
We were in the position to help him clear it - positioned it as inheritance come early.
Not sure you need a paid-for financial advisor to help you: only you can decide whether the money you would use can earn you more than 7.3%. I’d be surprised if it could, in any guaranteed way….& the knowledge you are £160pcm better off will be reassuring.
My personal choice would be to invest in low cost global tracker.
All the opinions of a stranger on the internet - suggestions, not advice
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