9%
Repayment Rate
£27,295
Plan 2 Threshold
30 yrs
Plan 2 Write-Off
5
Loan Plan Types
How Student Loan Repayments Work
Student loan repayments are based on what you earn, not what you owe. You repay 9% of everything you earn over your plan's threshold. If you're on PAYE, repayments are automatically deducted from your salary.
Income-Based
Only repay when earning above threshold. Earn less = pay less or nothing.
Time-Limited
Loans are written off after 25-40 years. Most people don't repay in full.
Automatic
Deducted through PAYE. No credit impact. Doesn't affect most financial decisions.
Student Loan Plans Comparison
| Plan | Threshold | Rate |
|---|---|---|
| Plan 1 | £24,990 | 9% |
| Plan 2 | £27,295 | 9% |
| Plan 4 | £31,395 | 9% |
| Plan 5 | £25,000 | 9% |
| Postgraduate | £21,000 | 6% |
Example: Plan 2 Repayment
£35,000 Salary
Your salary£35,000
Plan 2 threshold- £27,295
Income above threshold= £7,705
Repayment rate× 9%
Annual repayment£693.45
Monthly repayment£57.79
Should You Pay Off Early?
Usually No
- Most won't repay before write-off anyway
- Extra payments don't reduce monthly amount
- Money better used for pension or ISA
- You can't get voluntary payments back
Consider If...
- You earn significantly above average (£50k+)
- You're on Plan 1 with smaller balance
- You've maximized pension and paid off other debts
- Psychological benefit of being debt-free
Related Calculators
Related Glossary Terms
Frequently Asked Questions
Calculate Your Repayments
Use our student loan calculator to see exactly how much you'll repay each month based on your salary and loan plan.