Student loan: will you pay it off?

How it works

The calculator goes year by year, in today’s money. Each year interest is added, then you repay 9% of your pay above your plan’s threshold (6% for a postgraduate loan). Your pay rises by the rate you choose above inflation, and the threshold is taken to rise with inflation.

It stops when the balance reaches nothing, or when the loan is written off — whichever comes first. The write-off counts from when repayments began, so it asks how many years you’ve been repaying.

Interest is entered above inflation. Plan 2 charges up to RPI plus 3%, depending on what you earn; the other plans charge roughly inflation or less.

The 2026/27 thresholds it uses

• Plan 1 (started before September 2012 in England or Wales, or Northern Ireland): 9% above £26,900, written off after 25 years.
• Plan 2 (England or Wales, started 2012 to 2023): 9% above £29,385, written off after 30 years. This threshold is frozen until April 2030.
• Plan 4 (Scotland): 9% above £33,795, written off after 30 years.
• Plan 5 (England, started from September 2023): 9% above £25,000, written off after 40 years.
• Postgraduate loans: 6% above £21,000, written off after 30 years.
• Older Plan 1 and Plan 4 loans can have different write-off rules — check yours with the Student Loans Company.

A worked example

Say you’re on Plan 2, owe £45,000, earn £32,000 and have been repaying for two years, with pay rising 2% a year and interest 1% above inflation.

You’d repay about £235 in the first year (around £20 a month) and about £32,700 in total, and about £23,500 would be written off in 28 years. On Plan 5, with the same figures, it would be paid off in 32 years, after about £54,800 of repayments.

Questions people ask

Should I pay my student loan off early?

If it’s likely to be written off, paying extra may only shrink what’s written off, not what you pay in the end. If you’re on track to clear it, paying extra cuts the interest. The calculator shows which side of the line you’re on.

Does a student loan affect my credit rating?

It doesn’t appear on your credit file, but mortgage lenders count the repayments as an outgoing when working out what you can borrow.

How is it paid?

Employees repay through payroll, alongside tax. If you’re self-employed, it’s worked out on your Self Assessment tax return.

Does salary sacrifice lower my repayments?

Yes. Repayments are worked out on your pay after salary sacrifice, so a pension paid that way lowers them too.