UK Student Loans – SB or BS ?
UK Student loans, and more particularly the repayment of them, is a hot topic in the news at the moment. The student body is clamouring for more favourable terms, given Reeves' recent threshold freeze, the burgeoning cost of living, and progressive rises in student fees. There are particular concerns about the affordability of the legacy (i.e. Plan 2) scheme which still applies to all loans taken out between September 2012 and August 2023. The majority of outstanding loan balances currently fall under this plan (5.8 million loans taken out under the scheme in total), and the terms of this scheme has resulted in crippling interest rates due to the built-in 3% surcharge above RPI for anyone earning over £50k. The recent and quite prolonged spike in inflation, which resulted in interest rates well over 10%, at a time when most loan balances were still high, ceratainly added to the burden (and the size of the debt). The government is under pressure to act on this, and many a...