Australians with higher education loans will soon be able to earn slightly more before they have to start making repayments. This comes as inflation drives up student debts to new highs, and the federal government has lodged the official Help repayment thresholds for the 2023-2024 financial year on Thursday.
The minimum repayment threshold has been increased from $45,881 to $51,957 for the new financial year. This means that anyone earning above that amount will have to start making loan repayments, while those earning less than the threshold will not have to.
Graduates with an annual salary of $51,550 will now have to start repaying their student loans, an increase from the previous amount of $48,361. All other repayment categories have also seen an increase. HECS-Help, the form of student loans provided for Commonwealth-supported university places, does not accrue interest; instead, the amount is adjusted to the inflation rate annually.
At the March quarter, Australia’s official indicator of inflation – the consumer price index – recorded an unprecedented high of 7.1 per cent increase in Help loans, which will be indexed on June 1. Help loans are often referred to as “good debt” since they are usually cheaper than other forms of debt, as the repayments are free of interest.