Latest news with #studentloans
The Guardian
7 hours ago
- Business
- The Guardian
Students in England now graduate with average debt of £53,000, data shows
Students in England are finishing their degrees with government loans averaging £53,000, a jump of 10% in a year, as they increase their borrowing to meet the rising cost of living. The Student Loans Company (SLC) has released figures showing individual loan balances were £5,000 higher in 2024-25 than a year earlier, when the average in England was £48,270. In comparison, students in Scotland – where undergraduate tuition remains free for local students – finished with just £17,000 in government loans. Those in Northern Ireland accrued £28,000 in debt and those from Wales £39,470. Rising costs also mean more students are taking on paid work during term time. A survey published by the Higher Education Policy Institute found 68% of full-time students worked for an average of 13 hours each week, the highest rate in the decade the survey has been conducted. The SLC reported that 62% of former students who are liable to repay their loans are in the UK tax system, with nearly 3 million (40%) making repayments averaging £1,100 in 2024-25. The government's total student loan book for England has hit £266bn, up from £64bn 10 years ago after the introduction of £9,000 annual tuition fees and loans. That figure will rise more quickly from next academic year after the government raised the tuition fee for domestic students from £9,250 to £9,535 from September. The extra income is unlikely to solve higher education's financial woes, as the government plans to reduce the number of international students and competition between universities for domestic students intensifies. Research by the National Centre for Entrepreneurship in Education found that a quarter of the sector's leaders say their institution will need a 'complete overhaul' to survive the crisis. More than half of the leaders surveyed said financial stability was now their 'top institutional priority', while 28% said that international student recruitment was their most important activity. A new report by the Tony Blair Institute found that as tuition fees from UK students have been eroded by inflation, falling by nearly a third in real terms since 2012, many universities now rely on international student fees to cross-subsidise courses for domestic students. The institute warned that a group of universities are now vulnerable to changes to student visas that the UK government is considering as part of its immigration white paper, including a 6% levy on tuition fees, stricter compliance regulations and a reduction in the amount of time international students can spend working in the UK after completing their course. Alexander Iosad, the institute's director of government innovation policy, said universities with lower international rankings and former polytechnics had weaker finances and were most reliant on international students, putting them most at risk from any visa changes. The report says: 'As the government seeks to reform the immigration system, it is worth considering the interplay of these changes with the broader need to reform the higher education funding system so that it is put on a more sustainable basis.'
Yahoo
8 hours ago
- Business
- Yahoo
How Trump's budget bill will impact student loans: What to know
US President Trump's "big, beautiful bill," which is currently being considered by the Senate after passing the House, will change the rules for current students relying on federal loans and grants as well as borrowers working to pay down their debt. Author and student loan expert Mark Kantrowitz joins Wealth to outline these changes and what student loan borrowers need to know. To watch more expert insights and analysis on the latest market action, check out more Wealth here. All week, we're giving you everything that you need to know about paying back your student loans. Today, we're breaking down all the latest policy changes under the Trump administration. Joining us now for that, we've got Mark Kantrowitz, author and student loan expert. Mark, let's start with some of the proposals in the Republican budget bill. What changes could come for borrowers if it is passed as is? Well, first of all, it repeals the subsidized Stafford Loan for undergraduate students and the Grad Plus loans for graduate students. It sets the House version of the bill sets new aggregate loan limits of $50,000 for undergraduate students, $100,000 for graduate students, and $150,000 for professional school students. The Senate version of the bill, which just dropped this morning, uh has $200,000 limit for professional school students. And it has an annual limit for the undergraduate students of for the Grad Stafford Loan of $20,500 and $50,000 for professional school students. Uh, it gets rid of uh the economic hardship deferment and unemployment deferment, and changes forbearance to nine months out of every 24 months. Uh, and it's replaces the dozen or so, uh student loan repayment plans with just two. A standard repayment plan which is more like an extended repayment plan, the repayment term depends on the amount you owe. Uh, and an income-based repayment assistance plan, which is an income-driven repayment plan that uh has monthly payments that are slightly less than the current income based repayment, but much higher than under the save repayment plan which has been blocked by the courts. And so as we're trying to think about some of the largest changes for, for what this means long, what this means longer term, are students going to end up having a more difficult time getting student loans, not just applied for, but also getting those disbursements as well. What, what's the net effect? Well, the net effect is that uh, students at higher cost colleges that need to borrow more are going to have to borrow from the private student loan programs, uh, not just from the federal student loan programs. So, about 7% of undergraduate students, up to a little bit more than half of medical school students will have to borrow private loans because federal loan limits will not be enough. Um, the grants are also going down, which may shift uh, some students from getting grants into borrowing or not going to college at all. The House bill uh, eliminates Pell Grant eligibility for students who are enrolled less than halftime. Um, and that's going to disproportionately affect students at community colleges. It also changes the definition of full-time from 12 credits a semester to 15 credits a semester, which is the equivalent of about a 20% cut in the Pell grants that the students who were previously enrolled in 12 credits will receive. That means they're going to have to borrow, or not go to college at all. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
11 hours ago
- Business
- Yahoo
Credit scores will drop for more student loan borrowers, data shows
Imagine your credit score suddenly dropping by 63 points. For more than four million federal student loan borrowers, that's no nightmare. It's a wake-up call. In fact, a 63-point drop was just the average. Many of these borrowers experiencing a serious delinquency — at least 90 days late on a payment — in early 2025 saw their credit score drop by 42 to 175 points, according to a May analysis by the credit bureau TransUnion. And no one is immune. Borrowers with strong credit histories and cleaner credit reports saw their scores drop the most, by up to three figures. Even scarier? These borrowers could soon have more company. Some of the nearly eight million enrolled in the decaying SAVE Plan may soon face delinquency. So too could borrowers who have been struggling to enroll in income-driven repayment (IDR) plans. 'We're just waiting for them to be reported — we're calling those the shadow delinquencies,' says Michele Raneri, TransUnion vice president of financial services research and consulting. Yes, more than one in every five federal student loan borrowers in active repayment — 20.5 percent of about 19.6 million individuals — are three months or more late on their monthly dues. That's an all-time high, according to TransUnion, in part because Raneri says her team filtered out millions of federal loan borrowers who don't have an active payment due date. According to the Department of Education's own figures, that means more than five million borrowers are in default (270 or more days tardy), and as many as 10 million could be this summer. Being in default hits your credit, but it can also mean wage garnishment and forfeiture of federal tax refunds and Social Security benefits, among other consequences. 'So everything indicates that [this] is just the first group' to be reported, Raneri says. Related: We're facing a student loan default crisis. This academic research might help As mentioned, 20.5 percent of borrowers are 90 or more days delinquent (as of February 2025), but that figure pales in comparison to the 11.5 percent who were similarly tardy five years ago. Secretary of Education Linda McMahon places the blame squarely on colleges and universities, but the COVID-19 pandemic-inspired repayment pause and the last half-decade's fallout undoubtedly play a role, student loan payments are paused, borrowers saw their credit scores increase by an average of 74 points, thanks to the pause, according to the New York Federal Education Department announces 'Fresh Start,' removing the default status on credit reports for about 7.5 million defaulted Education Department calls for the resumption of monthly loan servicers begin reporting 90-days-or-more delinquencies to the credit Education Department resumes debt collection for federal loan defaults. In case you'd like a refresher, payment history is the single biggest determinant of your credit score. For FICO scores, for instance, whether you're on time or tardy with debt payments accounts for 35 percent of your score composition. That explains why borrowers have seen their scores fall so precipitously. Credit score before defaulting Average credit score drop after default (pts) 300 to 600 42 601-660 64 661-720 99 721-780 121 781 plus 175 Though borrowers with super-prime credit are the least vulnerable cohort, their path back to excellent credit won't be easy, Raneri says. 'They probably didn't have a 90-day-past-due on any [account] in the last seven years,' she says. 'And so it's difficult to come out and still become a super-prime again… And it'll take a couple of years probably for that to be in the rearview mirror, for it to fade away enough for it to bring the[ir score] back up.' Unsurprisingly, the lower your credit score, the more likely you have fallen behind in repayment. However, over the past half-decade, higher-credit borrowers have seen the biggest jump into delinquency. Percent of borrowers who are at least three months past due on a federal loan February 2020 February 2025 Percent change 300 to 600 38.8% 50.8% 31% 601 to 660 9.1% 23.3% 156% 661 to 720 1.3% 7.5% 477% 721-780 0.1% 2.1% 2,000% 781-plus 0.1% 0.9% 800% Spoiler alert: What's good for your student loan repayment is mutually beneficial for your credit report and score. Rehabilitate a defaulted loan, and your credit will thank you. Make a series of on-time payments toward your outstanding balance, and your score should increase over time. Of course, it's all easier said than done. And it can be overwhelming when you're wondering where to start. She continues, 'And so, if you have a fear of your credit, then you need to buckle down and just do it because it's not going to just go away. And I feel like there [are] people who with these student loans are kind of gambling with their credit score, thinking that maybe some [relief] is going to come through and it's not going to affect them. And by the time that you see it, it's probably too late. And then you have to start repairing it.' Take it from a certified student loan counselor: The important thing is to get moving. Here are some initial steps to take if your repayment has gone awry or requires a reset: Create or update your budget. It's the best way to understand your cash-flow, minimize unnecessary experience and set priorities, whether for your student loan or other debt payments. Reacquaint yourself with your education debt. You might log into your account (or your private lender's portal) to check your outstanding balances, interest rates and repayment status. Ask for help. While it's critical to be your own expert on your student loan accounts, it's always wise to request assistance. If you're disappointed in your federal loan servicer or private lender, talk to a certified counselor, student debt lawyer or organizations that offer student loan help. Settle on a strategy. Once you know where you stand and are aware of your education debt payoff options, picking a lane will ensure you keep moving toward the finish line. With that said, changes to your cash-flow could necessitate switching tactics down the road. Start or resume monitoring your credit. As you're getting more confident about handling your outstanding loans, track the improvement of your credit score. That can be gratifying and motivate you to stay on track to the bitter end. How to find help The National Foundation for Credit Counseling or your state's student loan ombudsperson are potential starting points. You're also welcome to email the writer at apentis@ Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Daily Mail
12 hours ago
- Business
- Daily Mail
HECS repayment changes in Australia as government slashes loans by 20 per cent
Anthony Albanese 's government will cut 20 per cent off all student loan debts, wiping around $16billion for about three million Australians. The policy - central to Labor's re-election campaign - is now set to be backdated to June 1, with the Greens expected to back Labor's legislation in the Senate during the next sitting of Parliament in coming weeks. Under the plan, a graduate with an average student debt of $27,600 will see their loan reduced by $5,520. Albanese's proposed reform would apply to all Higher Education Loan Program, vocational education and training student loans, Australian Apprenticeship Support Loans and other income-contingent student loans. 'Our whole nation benefits when we make it easier for people to access education. This is about opening the doors of opportunity – and widening them,' he said when announcing the plan. The reforms would also raise the threshold for repayment from $54,453 to $67,000 for the 2025-26 financial year, and lower the rate to be repaid. For someone on a middle income of $70,000, this will mean they will pay around $1,300 less a year in repayments. Education Minister Jason Clare said the cuts to student loans could be the first piece of legislation that Labor introduces when Parliament returns on July 22. How much your student debt will be wiped by is revealed in the table above 'The legislation will cut 20 per cent off your student debt and backdate it to 1 June, before indexation was applied,' Mr Clare said. 'This is a game-changer for the more than three million Australians with a student loan.' After the legislation is passed, the tax office will apply a one-off 20 per cent reduction to a student loan - without borrowers having to do a thing. This 20 per cent reduction will be calculated based on the amount of your HELP debt as at 1 June 2025, before any indexation is added. The government will notify you when the changes are implemented, and balances can be checked via myGov. The gap between the newly discounted repayments, and what tertiary institutions charged the students, will be funded by taxpayers and government borrowing. This builds on a $3billion policy introduced last year, which links student debt indexation to the lower of the wage price index or the consumer price index. Without it, graduates could have faced another steep increase, like in 2023, when indexation soared to 7.1 per cent - up from 3.9 per cent the year before - adding $1,759 to the average student debt of $24,770. The Higher Education Contribution Scheme in 1989 replaced the old system of free university education that had existed since 1974. Graduates pay a higher proportion of their salary on their student debt the more they earn, rising from one per cent under the existing $54,435 minimum repayment threshold to 10 per cent for those earning more than $159,664. Labor was re-elected in a landslide in May, and claimed three inner-city seats in Melbourne and Brisbane from the Greens that have a higher proportion of university students, including that of former leader Adam Bandt.
The Sun
a day ago
- Business
- The Sun
The best and worst degrees that could see you earn huge salary – with top job landing graduates nearly £70,000 a year
GOING to university costs an eye-watering £68,000, so it pays to pick a degree that will bank you a healthy paycheck. Here we take a look at the best and worst courses for earning a higher salary after graduation - and the difference in pay is a whopping £46,600. 2 While many students end up paying out £68,000, which is the total cost of studying. University costs have soared in recent years and the average student in England is now expected to graduate with a debt of £43,700. This sum includes maintenance and tuition loans. Most students will need to pay back their student loan over 30 years, after which point it is written off. This applies to graduates who are on a repayment scheme called Plan 5. Meanwhile, those who applied for a student loan after August 2023 will now need to pay it back over 40 years. These students are on the Plan 2 repayment scheme. Repaying such large debts can make it much harder to save for a house deposit or start a family. So, if you are weighing up your options after school or college, or even considering a career change, then our guide could help. Recruitment website Adzuna has crunched the numbers to reveal which degrees offer the best - and worst - value for money. The company analysed more than 100,000 CVs from job seekers between 2020 and 2025 to figure out how much they earned five years after graduation. Five of the degrees will lead to a job with a salary of more than £60,000 within five years - here's what you need to know. Which degrees lead to top-paying jobs? Unsurprisingly, students who study STEM subjects (Science, Technology, Engineering and Maths) are most likely to pocket the best pay checks. Students with Computer Science degrees are likely to earn the most out of anyone, and can expect to pocket an enormous £69,692 a year. That's £32,262 more than the average national salary, which is £37,430, according to the Office for National Statistics. 2 Figures provided by Adzuna Close behind were graduates with Biomedical Sciences degrees, who could earn around £67,792 a year. Meanwhile, students on Data Science degrees can expect to earn £64,412 a year. Financial Management graduates could pocket £63,662 a year. Hot on the heels are Business Analytics students, who can expect to earn £62,537 a year. Plus, Economics and Politics students can bag a pay check of £55,520 a year. How to find the right job for you Simon Fabb, CEO of shares his tips to help you find the right role. Get experience "Something I'd suggest every student do is start gaining relevant experience while they're still studying. "The job market is so oversaturated and having a degree on its own doesn't hold the same weight it used to, so have a look for internships, part-time work, freelance projects and volunteering opportunities to bolster your CV while reading for your degree. "Employers will want to see evidence of initiative and a real-world application of the skills you've been learning - especially is competitive sectors like tech or finance." Consider your location "Graduate salaries can vary hugely depending on where you're willing to work so have a think about location. "Large cities and major hubs, particularly London and parts of the South East, tend to offer significantly higher starting salaries than other regions. "Being flexible about location will gives you access to better-paid opportunities, especially in industries where demand is concentrated geographically." Look for remote jobs "In some sectors, remote roles are now common at entry level too, which opens up national and even international job markets." Work on your communication skills "Strong communication skills, confidence in interviews, adaptability, and a clear understanding of the role and company carry just as much weight. "If you can demonstrate that you understand the specific challenges and goals of a business you're much more likely to be offered higher starting package." Meanwhile, Accounting graduates have an average salary of £55,375 while those who study Big Data can earn an average of £54,075 a year. Engineers are also highly sought after, with two degrees in this subject leading to a high pay packet. Electronics and Communication Engineering students could walk away with £57,287 a year. Meanwhile, Industrial Engineers could earn slightly less, at £53,536 a year. Which degrees lead to the lowest paying jobs? There are certain degrees to swerve though if you're wanting a big bank balance. It may come as no surprise that those who studied the Arts will be the worst off. Graduates who studied Photography will earn the lowest salary of all students, with an average pay packet of £23,030 a year. That's £14,400 less than the national average. Several creative degrees will also lead to low-paying jobs. Among them is Textiles, which comes with an average salary of £23,837 after five years. Music and Fine Art graduates can also expect to earn less than their peers. A graduate with a music degree can expect to earn £23,903 a year, while Fine Art students can expect to pocket £24,020. I'm using my music degree to get into marketing MUSIC graduate Shakila Karim is using her degree to get a job in marketing. The 27-year-old graduated from ICMP with a Music Degree in 2019. Shakila had hoped to launch a successful music career and perform at venues across the UK, but the pandemic made this impossible. Instead, she worked at her local Tesco and gave music lessons to students online. When restrictions lifted she did several local performances, including at a charity gig in Bishop's Stortford. Shakila, from Hertfordshire, has now used her degree to get work experience in music marketing. She said: "I worked for a year at a radio plugger service, which pitched new music to heads of music, producers and DJs. "Now I've got marketing experience I'm trying to use it to find a full-time job in marketing. "I want to make sure my skills are transferable across all marketing industries and find a full-time marketing job." Several humanities degrees including Geography, Politics and History also made the list. A Geography graduate will earn an average salary of £23,445 a year, while Politics and History students will walk away with an average salary of £24,094. Meanwhile, graduates with specialist degrees also often earn low salaries. Criminology students earn a salary of £23,420 five years after graduation. Translation graduates can earn a salary of £23,498 while American studies students can expect to earn £23,924. Plus Zoology graduates can expect to earn £24,297 a year on average. How can I make myself stand out? When applying for a job, it's important to make sure you stand out. Tailor your CV and cover letter to the role you are after. Highlight your skills, experience and qualifications and make it clear that they match the job. Emphasise what makes you the right candidate for the role. In your cover letter and interview explain clearly why you are excited about the role, company and industry. You should also make it clear how your values align. You can find this information on the company's website and in the job description. If you do not have the right experience, then emphasise the skills you do have. Think teamwork, communication and problem-solving. You can also mention soft skills such as time management, communication and resilience. You can also highlight the ways that you have continued to learn and improve yourself. This could be through courses or workshops at university or hobbies. Do you have a money problem that needs sorting? Get in touch by emailing money-sm@
