For over half of young people, student loans are a looming worry for the future. An unthinkable amount of money at 18 that one day we will have to pay back. And as, for most of us, it is students loans chasing us down to find out our employment status, the idea that we may be paying too much hardly seems possible. But recent research tells us that this may be exactly the case.
It seems that the main reason former students are paying too much is that they begin paying too early. It’s easy to assume that you’re repaying the right amount if you have no experience to draw from. But there are ways to tell when you’re paying too much. And the amounts that are owed to people have proven to be worth checking.
How do I know if I’m paying too much?
If your University course started on or after 1998, you should only start repaying your loans the April after graduation. This is regardless of how much you have earned in a work position after this point. This will usually be due to a mistake made either by yourself or your employer when recording your earnings.
If you want to be certain that you are or have been paying the correct amount, have a look back through your payslips. You should be able to work out what you should have paid and earned over this period. One source estimates that over one hundred thousand people could fall into the category of those that have paid early.
I don’t think I was paying too early?
That’s good, but that’s not the only way in which people have overpaid. Research has shown that for over half a million students between 2010 and 2018, payments continued after the entire loan was paid off. Current reports by the higher education publication Research Professional News shows that over this time £308 million was overpaid.
Student loans has proactively tried to contact those that overpaid, but even now almost a tenth of this figure has yet to be refunded. This figure has been reported as being about £28 million. The average amount of repayment is also being reported at £600. The Student Loans Company say they have taken steps to prevent similar issues in the future. But that doesn’t change things for those presently affected; if you suspect that you’re one of them, make sure to look into it.
So how can I go about checking/claiming the money I paid?
The first thing you’ll want to do is work back through your financial forms, in particular your P40 forms. These will give you the information you need to know if you’ve been overpaying, either too soon or too late.
If you suspect that you did overpay, you’ll then want to contact Student Loans Company themselves. They give you information on how to apply here.
There’s no better time to check than right now, so have a look and see what you may be owed.