Expert advises checking student loan rates every year

Fri, 21 Oct 2011

Those with student loans should ensure they remain well informed about their level of debt and check what rates they are paying on a yearly basis.

Philip Pearson from IFA P&P Invest offers the advice in a recent article in the Independent, which discussed the case of graduate Jessica Dixon.

Ms Dixon, aged 24, has debt totalling approximately £19,000 and would like to pay this off and begin saving to buy a house within the next five years.

Bob Hair from wealth management firm Turcan Connell also says wiping out her student loan should not be a priority, as it is one of the cheapest forms of debt, so only a small percentage of income should go towards this sum.

"Although this means it takes ages to repay the debt, it is not as daft as it sounds because the interest rate is actually pretty low," Mr Hair suggests.

This comes as Johnny Rich, editor of Push.co.uk, claimed the majority of university goers will not be required to fully pay off their student loans, as the government often writes off the remaining amount in the long term.
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