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Originally Posted by bob_builder
If we assume that somebody has a £10,000 student loan and they get paid the average graduate salary of around £20,000 . This means that they will be paying £450 a year off the loan. So if the interest rate is around 7% (i.e. £700 per year) the loan will grow and they will never have to pay it off!  |
But in 10 years time, the guy will be earning a bit more than £20k. With inflation he'll be earning a lot more, even if he never gets a proper payrise or promotion. Most people will at some point get promoted on and higher, I would have thought.