University students that started after 1st August 2023 will be on a student finance plan called Plan 5. This will affect how much you'll be paying towards your student loan once you graduate, so it's important to know what it means for you.
What is Plan 5?
Plan 5 is the student loan plan introduced in 2023. It lowers the salary you need to earn before you pay back your student loan to £25,000, and extending the time you pay back your loan to 40 years.
The interest rate is 3% lower than for students on Plan 2 student loans, so the amount you owe won't go up as much each year.
Does this affect me?
The new student loan plan only affects students who started studying for their degree after the 1st August 2023. If you started your degree before that date, you'll be on either Plans 1 or 2.
Why are some against Plan 5?
Those against Plan 5 say that it will result in students having to pay more of their loan back once they start earning. However, the government says that under this plan, more students should pay back their loan.