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How does inflation indexation affect your HECS debt?
Australian Community Media
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1/24/2023
University graduates have just seen the largest debt indexation in 32 years.
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News
Transcript
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- Let me explain how indexation worked
00:38
on my own student debt.
00:40
In 2015, I finished an arts communications degree
00:43
at the University of Sydney.
00:45
At that time, my hex debt sat at about $29,500.
00:50
I started paying that amount down as soon as I finished uni
00:54
with about $1,000 going onto it each year.
00:57
But instead of actually going down,
00:58
by 2017, my hex debt had grown to $30,000.
01:03
I continued to pay a couple thousand dollars into the debt
01:06
each year, yet by 2022, I was still owing $27,000.
01:11
So, after six years, I paid about $6,300 into my hex debt.
01:16
But due to indexation, that debt was remaining at $27,000.
01:22
And that didn't matter to my day-to-day too much
01:25
until I wanted to buy a house.
01:28
Because of that growing debt,
01:29
banks didn't want to loan me money.
01:32
So, in order to secure a loan to buy a house,
01:35
I had to pay my hex debt in full,
01:38
which meant sacrificing nearly $30,000
01:41
from my deposit savings.
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