UK Student Loan Repayment Calculator
Calculate your student loan repayments, analyze early payment strategies, and understand write-off scenarios for all UK student loan plans
Student Loan Calculator
Enter your loan details to see repayment projections and strategy analysis
Your Repayment Analysis
See your detailed repayment projections and optimization strategies
All Loan Plans
Plans 1, 2, 4, 5, PG
Write-off Analysis
25-40 year terms
Early Repayment
Strategy analysis
HMRC Accurate
2025-26 rates
Complete UK Student Loan Guide 2025-26
Understanding Student Loan Plans
Plan 1 (Pre-2012): Applies to students who started before September 2012. Repayment threshold £22,015, 9% above threshold. Written off after 25 years or at age 65. Interest rates linked to RPI, typically lower than newer plans.
Plan 2 (2012-2023): Most common plan for English and Welsh students. Threshold £27,295, 9% repayment rate. Written off after 30 years. Interest varies from RPI to RPI+3% based on income during study and after graduation.
Plan 4 (Scotland): Scottish students studying in Scotland. Threshold £31,395, 9% repayment rate. Written off after 25 years. Lower threshold than other plans but shorter write-off period.
Plan 5 (2023+): New plan for students starting from September 2023. Threshold £25,000, 9% repayment rate. Written off after 40 years. Designed to increase repayment rates and reduce write-offs.
Postgraduate Loans
Masters Loans: Up to £12,167 for 2025-26. Repayment threshold £21,000, 6% repayment rate. Can be held alongside undergraduate loans. Written off after 30 years.
Doctoral Loans: Up to £28,673 for 2025-26. Same repayment terms as Masters loans. Available for PhD, EngD, and equivalent qualifications. Combined with Masters loans for repayment calculations.
Combined Repayments: When holding multiple loans, repayments calculated separately but collected together. Total monthly payment can be significant for high earners with multiple loans.
2025-26 Repayment Thresholds & Rates
Undergraduate Plans
Plan 1: £22,015 threshold, 9% rate
Plan 2: £27,295 threshold, 9% rate
Plan 4: £31,395 threshold, 9% rate
Plan 5: £25,000 threshold, 9% rate
Annual threshold reviews by government
Postgraduate Plans
Masters: £21,000 threshold, 6% rate
Doctoral: £21,000 threshold, 6% rate
Combined: Calculated separately
Lower rates but higher total payments possible
Write-off Periods
Plan 1 & 4: 25 years
Plan 2 & PG: 30 years
Plan 5: 40 years
From April after graduation
Interest Rates & Calculation Methods
Interest Rate Structure 2025-26
Plan 1: RPI (Retail Price Index) only. Currently around 3-4% annually. Simple structure with consistent rate regardless of income level. Relatively favourable compared to newer plans.
Plan 2: Complex structure from RPI to RPI+3%. During study: RPI+3%. After graduation: RPI (income ≤£27,295), sliding scale to RPI+3% (income ≥£49,130). Higher earners pay maximum interest rates.
Plan 4: RPI only, similar to Plan 1. Scottish government policy to keep rates lower. Beneficial for high earners compared to Plan 2 English equivalent.
Plan 5: RPI only, simplified from Plan 2. Government response to criticism of Plan 2 complexity. More predictable interest charges for borrowers.
Interest Calculation Examples
Low Earner (£30,000): Plan 2 borrower pays RPI interest only. Plan 1 and Plan 4 also pay RPI. Plan 5 pays RPI. Postgraduate loans accumulate RPI+3% interest.
Middle Earner (£40,000): Plan 2 pays RPI+1.5% approximately. Other undergraduate plans pay RPI only. Interest charges can significantly impact total repayment for Plan 2 borrowers.
High Earner (£60,000+): Plan 2 pays maximum RPI+3%. Other plans pay RPI only. Can lead to loan balance growing despite regular payments for Plan 2 borrowers early in career.
Should You Pay Off Early? Strategic Analysis
Arguments Against Early Repayment
High Write-off Rate: Estimates suggest 50-70% of Plan 2 loans will be written off. Early payments may be 'wasted' if loan would have been forgiven anyway.
Opportunity Cost: Money used for loan repayment could be invested in ISAs, pensions, or property. Potential returns may exceed student loan interest rates.
Mortgage Priority: Paying off high-interest mortgage debt (4-6%) may provide better guaranteed return than student loan overpayments.
Liquidity Value: Maintaining cash reserves for emergencies, opportunities, or major purchases often more valuable than early loan repayment.
Arguments For Early Repayment
High Lifetime Earnings: Graduates earning £40,000+ throughout career likely to repay in full. Early payments reduce total interest charged over loan lifetime.
Peace of Mind: Psychological benefit of debt freedom. Eliminates uncertainty about future policy changes or threshold freezes.
Career Flexibility: Without loan payments, easier to take career breaks, reduce hours, or pursue lower-paid but fulfilling work without financial penalty.
Interest Avoidance: Plan 2 borrowers with high earnings face RPI+3% interest rates. Early repayment eliminates compound interest accumulation.
Practical Repayment Strategies
The 40-Year Rule
Career-long calculations essential for informed decisions. Model salary progression from graduation to retirement. Consider: starting salary, expected growth rate, career breaks, industry prospects. If total projected payments exceed borrowed amount plus reasonable interest, early repayment may benefit.
Partial Overpayments Strategy
Rather than full early repayment, consider strategic overpayments. Target capital balance to reduce interest accumulation while maintaining liquidity. Particularly effective for Plan 2 borrowers earning £35,000-50,000 where interest rates are higher but full repayment uncertain.
Timeline Considerations
Early career: Focus on building emergency fund and pension contributions. Mid-career: Consider overpayments if surplus income available and mortgage overpayments less attractive. Late career: Final push to clear balance before write-off if total repayment likely.
Recent Changes & Future Outlook
Plan 5 Reforms (2023 Onwards)
Lower Threshold: £25,000 vs £27,295 for Plan 2. Means repayments start earlier in career, increasing total amounts paid by most graduates.
Longer Term: 40 years vs 30 years write-off. Significantly reduces write-off rates and increases lifetime payments for middle earners.
RPI Interest: Simpler interest structure removes RPI+3% maximum. Still accumulates interest but more predictable than Plan 2.
Government Rationale: Reduce taxpayer subsidy and increase graduate contribution to higher education costs.
Policy Uncertainty & Risks
Threshold Freezes: Government may freeze repayment thresholds in real terms, effectively increasing repayment burden over time through inflation.
Interest Rate Changes: RPI methodology under review. Changes to inflation calculation methods could affect all plans significantly.
Retrospective Changes: While unlikely, government has power to modify terms for existing borrowers. Early repayment eliminates this political risk.
Administrative Changes: Student Loans Company processes evolving. Ensure understanding of voluntary repayment procedures and annual statements.
Income Planning & Career Considerations
Salary Sacrifice Implications
Pension contributions, cycle-to-work schemes, and childcare vouchers reduce taxable income and therefore student loan repayments. High earners with large loan balances might benefit from maximizing salary sacrifice to reduce loan payments while building pension wealth.
Self-Employment Considerations
Self-employed graduates face different repayment mechanisms. Payments collected through self-assessment based on previous year's profits. Irregular income can lead to over/underpayments requiring careful management and potential refund claims.
Career Break Planning
Maternity leave, sabbaticals, or career changes affecting income trigger automatic payment suspensions when earnings fall below thresholds. Interest continues accumulating during breaks, particularly significant for Plan 2 borrowers. Factor into long-term financial planning.