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Student loan interest rates for the new academic year kick in today (Wed). Last year's interest free or even shrinking loans are making way for charges of up to 4.4% - depending on when you started your studies.
- Pre-1998 loans now 4.4% (was -0.4%). Here, the rate depends strictly on inflation (RPI) in the prior March; last year that was negative, so the debt actually shrank. This year, the 350,000 graduates still with these will pay a big 4.4%, ie, £440 interest a year per £10,000.
- Post-1998 holders & new students pay 1.5% (was 0%) & it could rise. The rate's the LOWER OF inflation in the prior March, (4.4%) OR UK base rate (0.5%) plus 1% point. So the 3.3m graduates with these loans outstanding will now pay 1.5% (£150 interest a year per £10,000 debt), but if rates rise this academic year, the student loan rate will too, to a max 4.4%.
Is it worth paying off?
There's no 'real cost to student loans, as the interest's only ever as high as inflation. Eg, borrow enough to buy 100 weekly shops, and you only ever repay the cost of 100 weekly shops, as there's no impact on your purchasing power (though as prices rise the cash amount repaid is higher).
So while the rate may've jumped, if you've spare cash and are considering repaying more than the minimum required, think carefully.
- Will you need other borrowing? Student loans are still the cheapest long-term debt possible for most. So repaying them only to later get a mortgage or car loan elsewhere at higher interest doesn't add up. It's better to save the cash at the highest rate possible, then use it to reduce future borrowing elsewhere.
- Can you earn more saving it? For those with post-1998 loans at just 1.5%, you can earn more in the top cash Isa (see below) than the loan's costing you, so would profit by simply stashing the cash.
For lots more info see the FULL GUIDE & CALCULATOR: Should I Repay My Student Loan?
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| The Ones Not To Miss |
Warning! Energy prices rises are back - after two years
ACT NOW to secure decent rates - over 1.2m face standard tariff cost hikes
For two years no big 6 energy company's increased their standard tariff prices (in fact they've been cut) yet from 1 Oct EDF's electricity prices will rise 2.6% in most UK regions. Will all companies raise prices? It's questionable if this is the start of a new price hike round, more likely it's a tariff tidy up. More worrying's the fact recently one super cheap online tariff after another's been pulled. Act NOW to secure a cheap deal. If you're on a standard tariff it's still possible to switch to a year's cheap online fixed deal to avoid any price hikes AND save a typical £250 a year (though deals aren't as good as when we first warned of this). Just do a comparison and tick the capped or guaranteed tariff option - though expect a small early-exit penalty. Compare, switch & get cashback: (only via these special MSE links) Top Pick: Energyhelpline* pays £15 cashback per switch. Scottish Power £70 cashback & wine: Uswitch* offers a crate of wine, plus Wed only £70 cashback on top for dual fuel Scottish Power switches. Dual Fuel: MoneySupermarket* £30 in cash SimplySwitch* gives £35 of Amazon vouchers. FULL info & cashback options in the Updated Guide: Cheap Energy + Cashback Related: Boiler Cover, Grant Grabbing
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Instant reusable 40% off Odeon voucher! Print as many as you like to use between Fri 3 Sept - Thur 14 Oct. See the Daily Deals List: Cheap Days Out
Totally FREE £20 energy saving plug! Instantly switches appliances OFF rather than to standby. Was just for those on benefits, now for all (barring N. Ireland, sadly). One per household. See the Updated Guide: Energy Grants
New top 2.8% AER Cash ISA or fix at 3.75%
Top tax-free rate on new and old ISA money but includes a 1% bonus for a year
There's a new top deal to dunk this year's £5,100 tax-free cash ISA savings in, or up the rate on money in your old ISAs. Top easy-access ISA: The e-ISA from Principality Building Society (min. £1) pays 2.8%. It's a variable rate though 1% is a bonus lasting only a year (so monitor whether it's still competitive then). It accepts transfers in from previous years' cash ISAs. Santander/A&L customer? Their current account holders can get 3.2% AER easy access with its Flexible Cash ISA (in branches only). It promises to be a min. 2.7% above the base rate (currently 0.5%) for a year too, but diarise the end date as it's likely to plummet after. It doesn't accept transfers. Fix at 3.75%: Get higher rates if you're prepared to lock cash away (ie, big interest penalties for early withdrawals), over 1 year Aldermore is 3% (min £1,000), over two Chelsea BS is 3.3% (min. £100) and over three Nationwide is 3.75% (min. £1). FULL pros, cons, savings safety info (all have full UK £50k protection) & more in the Updated Guides: Top Cash ISAs & Best ISA Transfers Related: Top Savings
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Last chance! Tesco 'double rewards' ends Sun. You can double the value of your vouchers IN-STORE on certain categories until Sun. See the News Story: Tesco Revamp
Cheapest ever line rental - £8.25/mth
Saving of nearly £50 a year plus unlimited weekend calls
Next month, BT hikes its standard line rental from £11.54/mth to £12.04, yet you can slash costs without changing lines (just who bills). £8.25/mth: For line rental and weekend calls, until Oct, the new Primus Saver Plus* deal charges £99 up-front for a year, which works out at £8.25/mth. Alternatively, pay monthly and the same's £8.99/mth on Primus Saver*. Do note, in this economic climate, paying upfront means you're reliant on the company's solvency (Primus is owned by a big US company, we're not saying problems are likely, just be aware). Stick with BT for £9.49/mth: BT's Line rental saver* promo lets you pay £114 for a year upfront, equivalent to £9.49/mth inc. weekend calls, compared to £145/year at its new monthly rate. Cut costs further: Sign up to 18185 and dial that prefix before the number you're calling to cut daytime calls to landlines to 5p/CALL rather than 5.9p & 3.5p per MIN, respectively, from BT & Primus, and it's also roughly half the cost for mobiles mid-week. FULL pros, cons, & possible cashback details in the Guide: Cheap Home Phones Related: Cheap Broadband, Cheap Gas & Electricity
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Fancy £10/night for a 4* country mansion?
400 UK hotels seriously discounted via tokens in the £1 News of the World this Sun & next
Sept-Dec stays with rooms £10-£40 a night. The paper's cost's tiny compared to poss savings. See the Deals Note: Hotel Sales
Got friends who'd like to save? Please tell them about this email
New web codes: French Connection 20% off (via £2 mag)
Plus INSTANT Wallis 10% off | Warehouse 15% off | Oasis 20% off sale items | Figleaves 20% off
These join printable voucher for Gap 15% off, A/ware.com 20% off & Boots Photos 20% off. Full info in the Daily Deals List: Discount Vouchers
Warning! Have you over-covered your building insurance?
Insurance body BCIS says many could save £100s by correcting cover levels
New research shows up to 30% have mistakenly used their home's market value for buildings insurance, rather than the correct and usually much lower, rebuild cost. Plus as raw material prices for building and projects have fallen, even if you got it right previously you may be overpaying now. Check your rebuild value: Insurance body BCIS has told us that all of our top four comparison sites calcs have the latest rebuild value calcs in (and are better than the ABIs own) - GoCompare*, CompareTM*, Moneysup* & Confused* so check and get new quote at the same time. Use more than one to increase the range of your comparison - though rebuild values may vary slightly due to diff. assumptions.. Leaseholders don't need it: Some homeowners buy buildings cover when they only have leasehold agreements; yet usually only freeholders need it. Get PAID for a policy? If you really want to push it to the nth degree, a few MoneySavers have actually been PAID to take home insurance out (record is £67 PROFIT) as cashback sites give more out than some policies cost. FULL info on how to try that in the Updated Guide: Cheap Home Insurance Related: Cheap Car Insurance, Boiler Insurance, Mortgage Life Assurance
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Last Chance! Fancy a US trip? Beat its new $14 tourist 'tax'
From next Wed you'll pay $14 to file compulsory security form, do it now and it's free for 2 years
Get or renew the Esta now while it's free, even as a 'just in case' you go. See the Full Guide: Beat ESTA Charges
Urgent! Open oft-closed doors at 4,000 English heritage sites
Eg, Beatrix Potter Gallery (usually £5) or flight displays at Bentley Priory, Herts (closed to public for 70 yrs)
English Heritage Open Days from Thur 9 to Sun 12 across England, book now. See the Deals List: Cheap Days Out
New FREE 'Weekly Email PLUS' on Facebook!
Speedy access to the email first thing every Wed & more super short-lived deals too
Over 5 million people now get this weekly email, and it can take 18 hours to send. So to help those who are keen to get in first we're launching a new Facebook service. New! Weekly Email PLUS on Facebook: Every Wed. morning we'll be posting the Martin's Money Tips email on this special Weekly Email PLUS Facebook page, meaning regardless of where you are in the list, you can get it then (just click the like button). Plus when we spot cracking deals, tips & info that are too short lived to make the email we'll post it up there too (don't worry it won't be too many, only if they pass muster). Martin's Facebook page: Separate to that is Martin's Facebook page, less about MoneySaving tips, instead full of blogs, thoughts musings and his now (in)famous Friday 'joke'. Feel free to join both and spread the word.
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New York £331 all-in, Boston £362, Miami £396, LA £426 + more
American Airlines, BA & Virgin sales all on - always compare for cheapest before you book. End 14 Sept
Fares have crept up since May, but these knock up to £100 off standard prices. Mostly from London, travelling until 29 Jun 2011, to cities worldwide. Full info in the Forum Note: Flight Sale
4GB memory stick plus latest Star Trek film £7. An impulse level price for memory alone, so cling-on. Better still it's shaped like a 'Starfleet emblem'! It's a USB stick Jim, but not as we know it... See the Forum Note: Enterprising deal
Thousands overcharged for water bills. Are you owed £20-£200?
Many rural homes unconnected to mains sewers are due a rebate - find out how!
If you live in a rural area and have a soakaway, septic tank or cesspit, you should check now whether your water bill includes a sewerage charge to take water from your home even though you're not using it. Recent reports in The Times suggest 10,000s are being charged who shouldn't. Here's how to get your cash back...Step 1. Contact your water company. It should provide you with a form to fill in for a rebate; sadly you can only claim for this financial year. Step 2: Take it to the Consumer Council for Water. If your water company won't give you a rebate or you feel they should reasonably have known you were not connected (eg, a block of flats and other residents already receive an allowance) get in touch with the CC for Water office who should be able to help. Full details in the Updated Guide: Water Bill Cost Cutting
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New! Pizza Express 2for1 for £1 and Loch Fyne £10 deal
Plus Strada 2for1 | GBK two burgers n' fries for £10 | Prezzo starter, main n' drink for £10 | Zizzi 2 mains £12
Joins ASK two mains for £10 and Vintage Inns two courses for £9.95 in the Daily Deals Finder: Restaurant Vouchers
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| Big & Easy Ways To Save |
| Quick links or click the titles for full pros, cons, alternatives & more savings |
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| More MoneySaving |
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Q. I would never leave my dog in the car without opening a window for him. But does this invalidate my car insurance?
Helen, by email
Martin's A. It's perfectly possible it could, some policy's terms state a car must be locked and all points of entry closed for claims to be accepted - check yours. Yet if you claim insurers should look at what's fair and reasonable eg, did it make a difference the window was left open - would the theft have taken place anyway?
If you feel your insurer's not been fair you can take your complaint to the Financial Ombudsman.
You're even less likely to be covered if you decide to leave house windows open for a pet, unless they're windows that lock shut with a small opening, as it's an easy way for burglars to get into your property, so avoid this where possible.
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Discuss: Pets & car insurance
Suggest: A question of the week
(big general issues not personal q's pls) |
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Explanation of * Links
FSA NOTE: Referring people to insurers or insurance intermediaries can in some circumstances require FSA authorisation. For this reason, Martin Lewis of Shepherd's Studios, Charecroft Way, Shepherd's Bush, London W14 0EH is authorised and regulated by the Financial Services Authority.
How this site is financed. Any links with a * by
them are affiliated. That means go via this link and a contribution may be made
to MoneySavingExpert.com, which helps it stay ad-free and free to use. You
shouldn't notice any difference, the links don't impact the product at all and
the editorial line (the things we write) is NEVER impacted by it. If it isn't
possible to get an affiliate link for the best product, it's still included in
exactly the same way. As we believe transparency is important, we're including the
following 'un-affiliated' web-addresses for the same things: alliance-leicester.co.uk, americanexpress.com, barclaycard.co.uk, bt.com, comparethemarket.com, confused.com, energyhelpline.com, firstdirect.com, gocompare.com, homephonechoices.co.uk, moneysupermarket.com, natwest.com, plus.net, primusconnect.co.uk, rbs.co.uk, santander-products.co.uk, simplyswitch.com, tescofinance.com, uswitch.com. Read more about this in how this site is financed.
MoneySavingExpert.com is the free to use Consumer Revenge website focused on how to save you cash. It's owned, and run by ultra-focused journalist and bestselling author Martin Lewis. On TV amongst other things Martin is GMTV's Money SavingExpert and presents money programmes for ITV1 Tonight. On Radio Martin has regular slots on Radio 2 Vine and Radio 1 Whiley. He's also a columnist for amongst others the News of The World, The Telegraph and the Sunday Post. Find out more: About the site and its funding.
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