vengeanceismine
New member
Dear all,
I am using a throwaway account for privacy reasons.
I would appreciate receiving advice on whether it is more advantageous to repay my entire student loan now or to begin repaying it after completing my education.
I graduated with my BSc in 2018, accruing a total loan of £19,150. Following this, I pursued further studies (Masters+PhD) outside the UK (in the EU), and am currently two years away from completing my PhD. I have not made any repayments.
My loan has now increased to £25,727, with a current interest rate of 7.6% (variable). I would have to start repaying it after finishing my PhD, paying 9% of my gross monthly income after a certain threshold.
For my PhD, I have the option to secure a bank loan (outside the UK) at a favorable 2% maximum interest rate, which requires repayment within 10 years starting after the completion of my studies. This would allow me to settle the £25,727 student loan immediately.
After 30 years (in 24 more), the original UK loan is forgiven, whereas the new one would need to be repaid within 10 years.
Post-PhD, I anticipate securing a job with an initial monthly salary of approximately £5,800 (gross), with expectations of salary growth over time. With this salary, I would be repaying around £320 per month, which would then increase when my income increases.
Maths is not my strong suit, and I do not know how to calculate the repayment timeframe or the total amount I would end up paying if I begin repayments after my PhD (in two years), nor do I know whether it would be better to repay the entire loan now using the bank loan at a 2% maximum interest rate. Or maybe it would be better to invest it in an all-world ETF?
I would appreciate any advice you could give. Thank you very much for your help!
I am using a throwaway account for privacy reasons.
I would appreciate receiving advice on whether it is more advantageous to repay my entire student loan now or to begin repaying it after completing my education.
I graduated with my BSc in 2018, accruing a total loan of £19,150. Following this, I pursued further studies (Masters+PhD) outside the UK (in the EU), and am currently two years away from completing my PhD. I have not made any repayments.
My loan has now increased to £25,727, with a current interest rate of 7.6% (variable). I would have to start repaying it after finishing my PhD, paying 9% of my gross monthly income after a certain threshold.
For my PhD, I have the option to secure a bank loan (outside the UK) at a favorable 2% maximum interest rate, which requires repayment within 10 years starting after the completion of my studies. This would allow me to settle the £25,727 student loan immediately.
After 30 years (in 24 more), the original UK loan is forgiven, whereas the new one would need to be repaid within 10 years.
Post-PhD, I anticipate securing a job with an initial monthly salary of approximately £5,800 (gross), with expectations of salary growth over time. With this salary, I would be repaying around £320 per month, which would then increase when my income increases.
Maths is not my strong suit, and I do not know how to calculate the repayment timeframe or the total amount I would end up paying if I begin repayments after my PhD (in two years), nor do I know whether it would be better to repay the entire loan now using the bank loan at a 2% maximum interest rate. Or maybe it would be better to invest it in an all-world ETF?
I would appreciate any advice you could give. Thank you very much for your help!