More than 2.6 million people in the UK are grappling with student loan debts exceeding £50,000, according to new figures from the Student Loans Company (SLC).
Data obtained by Compare the Market through a Freedom of Information (FOI) request revealed that as of August 10 this year, a total of 2,652,997 student loan customers had an outstanding balance greater than £50,000. The highest individual student loan balance recorded stood at £299,645.
In its response to the request for the highest student loan balance currently on its records, it said: “The student finance system is designed to provide funding for various levels of study from further education, through to higher and then postgraduate, and doctoral study.
“The system also includes safeguards for students as it enables them to access extra years’ funding for resits, false starts and compelling personal reasons where appropriate.
“The average loan balance on entry into repayment for English borrowers is £53,010, therefore these higher loan balances are not reflective of the average level of a student loan balance for a student on the standard three or four-year higher education course journey.”
The SLC said customers with balances higher than the average level of a student loan balance may be in receipt of several student loan products.
As of August 10 this year, 2,478,047 customers had paid off their student loans in full.
Meanwhile, a total of 8,607,271 student loan customers had an outstanding balance, according to the SLC’s figures.
Compare the Market said it has put together a guide for students on how to navigate their student loans which could also help graduates starting out in the world of work.
It said that for new students attending university, tuition fee loans may cover the cost of course fees and the loan is paid directly to the university or college.
A maintenance loan will cover accommodation and living costs, and is paid directly into a student’s bank account at the start of each term.
The maximum amount students in the UK can borrow for a maintenance loan depends on where they live.
There are also different student loan repayment plans for UK borrowers and which one a student is on will depend on when they started their course, and where, Compare the Market said.
It added that when graduates are eligible for repayments, they will be deducted from their salary, or if a graduate is self-employed, their student loan will be included when filling out their self-assessment tax return.
Sajni Shah, a money expert at Compare the Market, said: “It is important for students to stay well-informed about the different types of student loans available to them and how repayments work.
“The continued rise in living costs means essential expenditure such as student accommodation, utility bills and textbooks are increasingly expensive for students.
“As a student, you’ll have access to a wealth of discounts which will make day-to-day spending that little bit easier.
“Always ask in-store if they offer a student discount – many places don’t advertise it. Try to stick to own-brand products, cook in bulk and freeze portions. Review your subscriptions and cancel unused ones.
“Many subscriptions also have student rates you can switch to.
“If you’ve got a phone plan, pay utility bills or have a car that needs insuring, make sure to shop around before signing up to a new deal.
“This could help you make some meaningful savings, especially if you’re signing up to multi-year contracts.”
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