WHEN I read about fellow midlife women paying back their student loans for most of their career, I wonder how they cope financially?
Every month, someone earning just £30,000 a year will see a 9 per cent salary deduction, or a whopping £225, disappear from their pay slip, and I’m sure they will be resentful that I never do despite doing
Erica Cartier has amounted a total of £60,000 in debt thanks to her student loansCredit: Supplied
But she has never earned enough to pay the money back and even plans to take on more debt to do a PHDCredit: Supplied
I’ve hatched a plan to avoid ever repaying my £60k student loan by staying on until I get my .
That’s right, I never plan to earn over what will allow me to – £411 a month.
With Chancellor latest clanger this should come as little surprise.
In her new budget there’s a freeze on the threshold we can earn before repaying our student debt at a lousy £26,900 per year in 2027-2027 – and that’s before tax.
This threshold will then be frozen at this level until at least April 2030.
Graduates earning over this nominal sum will repay their loans off with a whopping nine percent salary sacrifice, each and every month.
So, by keeping what little I earn from writing so low, and staying on tax-free Universal Credit, I have effectively beaten the system.
The has lent me a tidy £60,000, but I’ll make sure that’s the last time I’ll ever be burdened by that kind of debt.
Most student loans are eventually written-off in retirement. But I’m 45 now and have dipped in and out of degrees in the arts most of my adult life.
And yet I still haven’t maxed-out all my student loans and I’m still eligible for an extra thirty-grand loan for a 3-year PhD which I plan to do one day.
So long as you don’t already hold a qualification of the same academic level, you can secure a loan.
I started my career as a professional student and talented layabout after a stint studying fashion design at University for two years in 1999.
After I dropped-out, my opening salary for work was £11,500, but in London. The salary was low but there were lots of perks like free designer clothes, free nights out, and paid-for trips in a hillside, Tuscan villa and in a chalet for a ski-trip in Colorado.
It was a great way to live a life of luxury all while avoiding paying-off my student loans.
Since then, I’ve woven in between jobs and degrees, often using a student loan to make ends meet and even using my master’s loan surplus of £7,500 to get my kitchen done.
I had the surplus by finding a masters I could study with the lowest fees. Online courses are good for low-fees so you’ll end up with more cash for you.
Another great way to keep the loans flooding your bank account is to drop-out of a course before it finishes. If you don’t pass a course of study, you can get another student loan for another course that’s of equal value in academic achievement – and that’s exactly what I did.
I dropped off my BA(Hons) in fashion design in 1999, in my second year, with £6000 loans.
Will I be better off on Universal Credit?
AROUND 1.4million people on legacy benefits will be better off after switching to Universal Credit, according to the government.
A further 300,000 would see no change in payments, while around 900,000 will be worse off under Universal Credit.
Of these, around 600,000 are expected to get top-up payments if they move under managed migration, so they don’t lose out on cash immediately.
The majority of those – around 400,000 – are claiming employment support allowance (ESA).
Around 100,000 are on tax credits while fewer than 50,000 each on other legacy benefits are expected to be affected.
Examples of those who may be entitled to less on Universal Credit according to the government include:
- Households getting ESA who and the severe disability premium and enhanced disability premium
- Households with the lower disabled child addition on legacy benefits
- Self-employed households who are subject to the Minimum Income Floor after the 12 month grace period has ended
- In-work households that worked a specific number of hours (e.g. lone parent working 16 hours claiming working tax credits
- Households receiving tax credits with savings of more than £6,000 (and up to £16,000)
But if they don’t switch in the future, they’ll risk missing out on any future increase to benefits and see payments frozen.
Those who move voluntarily and are worse off won’t get these top-up payments and could lose cash.
Those who miss the deadline and later make a claim may also not get this transitional protection either.
The clock starts ticking on the three-month countdown from the date of the first letter, and reminders are sent via post and text message.
There is a one-month grace period after this, during which any claim to Universal Credit is backdated, and transitional protection can still be awarded.
Then, in 2004, I blagged another £9000 student loan to do a Foundation Degree in Journalism, which I did pass.
Then, to finally graduate with honours in 2017, I got out a further £15,000 student loan for a ‘top-up’ art degree, which is technically the final year of the BA Hons I didn’t pass initially in 1999.
That’s an income of £30000 over five years of dossing, painting and puffing my vapes on the sofa.
As I have come to discover though, these creative degrees I have – in journalism and fine art – are seen as Mickey Mouse degrees by employers and often creative jobs that suit my personality are low paid.
And when I say low-paid, I mean these jobs don’t pay more than my £1027 a month – tax-free and loans-free – benefits do.
Each month, as part of a joint claim with my disabled partner, I pocket £1027 in Universal Credit. As well as an extra £295 of Personal Independent Payment each month for managing my schizo-affective disorder. I’d get the latter each month whether working or unemployed.
I will be watching the interest on my student loans accumulate with no intention of ever paying them off
Erica Cartier
I also earn around £850 a month writing articles like this, none of which is taxed. So, the total of my monthly income isn’t above the £29000 earnings a year that would force me to pay back my student loan.
If I do go-ahead with doctoral studies, I can keep most of my Universal Credit, and all my Personal Independence Payments, while raking in a further £33,000 in student loans.
In fact, there’s a little-known rule that the Student Loans Company won’t shout about. This is, if you send them a letter from your doctor stating you’re unfit for work for a lifetime, all your debt will be immediately written off.
My psychiatrist won’t agree to this, for me. So, I will give it another go and see a private shrink.
Until then, I will be watching the interest on my student loans accumulate with no intention of ever paying them off. Cunning or what?
Erica hopes that she can one day have her whole loan written off due to her disabilityCredit: Supplied
Eze Chidiebere Paul
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