A HELP loan is a student loan, and is very different to a loan from the bank. Unlike a bank loan, you are only required to pay back your HELP loan once your income reaches a certain amount or threshold, known as the compulsory repayment threshold. Once your income reaches that level, you need to start paying off your HELP loan even if you’re still studying. It’s important to know that you will still have a HELP debt even if you don’t complete your study. So for example, if you complete the first year of a three year course but defer or stop your study after the census date, you will still need to pay back the cost of that first year. If you are withdrawing, it is your responsibility to complete your provider’s formal withdrawal procedures. When you are repaying a HELP loan, the rate you have to pay will depend on how much you earn and varies from two percent to eight percent of your income. The Australian Tax Office, or ATO, will calculate your repayments based on your income. When you start working you will need to declare that you have a HELP debt, and repayments are deducted from your pay once you reach the repayment threshold. However you can make voluntary repayments to your HELP debt at any time. Before you access a HELP loan, make sure you understand your obligations around repaying the loan and stay informed about any changes to the HELP scheme and how they could affect your repayments. When I decided to study, I wanted to pick the right education provider for me. I started looking into different providers early so I had enough time to make the right decision, and I knew I wouldn’t be pushed into picking something that wasn’t right for me. I had to think about things like how far I would have to travel each day, whether studying online would work for me, how much my course would cost me, and whether I had used a HELP loan before. When I asked how to pay for my study, I found out that I could either pay upfront or use a HELP loan, which meant that I could pay it back when I was earning enough. I chose to take out a HELP loan to pay my tuition fees, because I wasn’t in a position to pay for my studies upfront and neither were my parents. When I finish studying this year, I will have a $20,000 HELP debt. Here is what my HELP loan repayments might look like. If I work full time and earn a salary of $55,000 a year, two percent of my pay would go towards repaying my HELP loan, and this is taken out of my pay along with regular tax payments. This means that I would be making repayments of $1,100 a year towards my HELP debt, which is about $42 a fortnight. I know that when my salary increases, so will my HELP debt repayments. Each year my HELP debt will increase because of indexation which reflects increases in the cost of living. If I decide to take on more debt, like buy a car, I will need to include my HELP loan repayments in my budget. If I decide to move overseas to work, I will still have to make repayments to my HELP debt. It is important to make informed financial decisions, so I will do my research, starting with the MoneySmart website, before making any financial commitments. A HELP loan is a great way to pay for your study, but it is a loan, so make sure you know what’s involved. To find out more about HELP loans, search online for Study Assist or visit studyassist.gov.au.