Zoe thought 2023 would be the first year shed make a dent in her $123,000 student debt.
The arts law graduate from Victoria has been working full-time in the public service sector for five years. In that time, her Higher Education Loan Program (Help) previously the Higher Education Contribution Scheme (Hecs) hasnt shifted, even though she has been making payments on it for five years.
In Australia, student loans are tied to inflation and increase annually in line with the consumer price index (CPI), which means rises cause Help loans to spiral, sometimes in excess of repayments.
On Wednesday, the new yearly rate of indexation is expected to be announced at about 7%, up from 3.9% last year and 0.6% in 2020. It will take effect on 1 July.
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Read the full article at: https://www.theguardian.com/australia-news/2023/apr/26/its-perverse-how-australias-student-loan-scheme-traps-graduates-in-a-debt-spiral