Exploding Student Debt: Graduates Face Sky-High Balances Surpassing £100K!

As frustration mounts among countless graduates burdened by escalating student loan debts, signs are emerging that this issue might soon confront the government with a serious challenge, with Martin Lewis at the forefront of calls for immediate reform.

The founder of MoneySavingExpert, Martin Lewis, has openly criticized Chancellor Rachel Reeves concerning changes to repayment thresholds that impact approximately 5.8 million individuals who secured student loans from 2012 to 2023.

Numerous graduates, primarily under the plan 2 repayment scheme, shared their experiences in response to a request from The Guardian regarding their student loans. Below are their accounts.

‘This debt is a lifelong burden’

Amy Cayzer, 24, works as a communications officer in the charity sector and graduated in 2023 with a first-class degree. She has seen her student debt increase dramatically, with interest rates reaching up to 8%.

Originally from a low-income family and the first in her family to attend university, Cayzer started with a debt of £73,814, which has now ballooned to £93,793 and is on track to surpass £100,000.

“It’s crushing to see that my monthly payments barely scratch the surface of the debt. It feels like this debt will be with me for 30 years, and there’s no escaping it no matter how much I pay,” she states. “It’s a stark reminder of the inequalities that persist, as my peers from wealthier families had much less to pay back, often with parental support,” Cayzer adds.

She was only 17 when she began exploring student finance options and feels that the long-term implications of her debt were never properly explained to her. “The explanations provided at the time really downplayed the longevity of the debt,” she remarks.

Despite not regretting her university education, she finds the ongoing financial strain disheartening and worries it might deter others from less affluent backgrounds.

‘My repayments could reach £150,000’

Jo*, a music teacher in London, is nearing a distressing milestone with their student loan debt approaching £100,000. “It’s a daunting figure,” they say.

Having studied at a prestigious London conservatoire from 2013 to 2017 and currently pursuing a master’s degree in music education, Jo’s total debt is about £99,987, with the bulk of it, £93,335, stemming from their undergraduate studies.

“I once calculated using an online tool that over the 30-year term of the loan, I’d end up paying back between £100,000 to £150,000,” Jo explains.

Jo expresses a deep sense of betrayal over the financial system. “It’s unfair how previous generations didn’t have a ‘graduate tax’ and yet, here I am, burdened heavily for trying to improve myself. It’s discouraging to think about working more or taking a second job when it feels futile against the high cost of living and rent,” Jo laments.

“I think the UK would benefit from funding education through general taxation rather than putting all the burden on my generation,” Jo adds.

‘Earning more doesn’t seem worth it’

William Pratt, a 29-year-old data analyst from Cambridge, voices a common sentiment among those grappling with student loans. Having graduated with a PhD, his initial student loan debt from his undergraduate studies was £56,000, which has now escalated to nearly £90,000. “It feels hopeless. I’m never going to be able to pay this off,” Pratt states.

In addition to his original student loan, Pratt took out over £10,000 for a postgraduate course. His monthly repayments are nearly £300, which he points out could otherwise be spent on essential living expenses. “That money could cover my utility bills or my car payments,” he says.

Over the years, his frustration has turned into resentment, especially towards policies favoring older generations, such as the triple lock on pensions. Hearing Chancellor Rachel Reeves call the system fair is particularly hard for him to accept.

Despite earning a decent salary, Pratt finds that the system discourages advancing his career. “I’ve reached a point where earning more money doesn’t appeal to me,” he explains, after seeing how much of his additional income would go towards taxes, pension contributions, and student loan repayments. “It’s clear that this system is not sustainable,” he concludes.

‘My loan payment exceeds my mortgage’

Daniel, a 28-year-old engineer from Newcastle, is another graduate feeling the weight of student loans. He pays £856 a month towards his student loans, which is more than his mortgage. His recent payslip showed £491 deducted for his undergraduate loan and £365 for his postgraduate loan.

Daniel opted for a master’s degree in 2020 when the job market was unstable due to the pandemic. “It seemed like a good way to pause life until things improved,” he reflects. However, he was aware that the terms were less favorable than his undergraduate loan, adding significantly to his existing debt.

His total debt now stands at around £83,000. Only after a recent salary increase did he see a modest decrease in his debt balance by about £50 a month.

“We were told as teenagers that these loans would be barely noticeable,” he recalls. Now, he sees the system as a tax on those who can’t afford to pay for university upfront. “If young people had more disposable income, it would be spent and boost the economy rather than just disappearing,” he argues.

“It’s no surprise that many young people feel disillusioned with politics,” Daniel concludes.

‘We committed to these loans as teenagers’

“We were practically children when these loans were marketed to us,” says Nicole, who pursued a degree in classics at Durham University.

As the first in her family to attend university, Nicole feels deceived by the promises made about student loans. “Teachers advised us that the repayments would be a small percentage of our salary and likely never fully repaid, with the remainder forgiven after 30 years,” she explains.

Now in her early 30s and working in the heritage sector with a salary of £35,000, her monthly repayment is nearly £150—a sum she could certainly utilize elsewhere.

Living in Teesside, she managed to buy a house in 2020, which was financially feasible at the time. “However, with rising living costs and a recent mortgage renewal, I’ve had to cut back on my pension contributions just to stay afloat,” she says.

“I started with £58,000 of debt, and it’s now £72,000. Despite my repayments of £965 between April and October, the interest added was £1,669,” Nicole shares. “It’s incredibly frustrating to see that despite making payments, the principal amount hardly decreases—unlike other types of loans where you see the balance drop. It feels immensely unfair, especially considering that those just a few years older than me had significantly lower tuition fees.”

‘The reality was not as promised’

Rebecca from Lancashire, who was part of the first cohort to take out a plan 2 student loan for her studies in land economy at Cambridge University between 2012 and 2015, expresses disillusionment with how the loan system has evolved. Initially, she received some financial aid through a bursary and left with about £35,000 in debt. “I haven’t checked recently, and I don’t want to,” she admits.

“We were assured that the loans were tied to an index with low interest, suggesting minimal real growth in debt. However, no one mentioned that they would keep lowering the repayment threshold. With inflation from April 2016 to April 2026 around 53%, but the threshold only increasing by 35%, the situation is only getting worse with the recent budget changes,” she explains. “I feel somewhat cheated, as this isn’t what we were led to expect.”

For mothers like herself facing childcare costs, the financial model makes working more days economically unrewarding. “It’s like a graduate tax,” she says. “I work four days a week and wouldn’t consider five, as I’d lose half of it.”

* Name has been changed