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What is HECS?

HECS-HELP exists to help students get through university when they don't have the money up front. There are three main ways to manage HECS-HELP and all of them can put a degree within reach:

  1. Pay the whole lot upfront and get a big 10% discount.
  2. Pay anything over $500 upfront and get a 10% discount on that, then defer the rest until you're earning.
  3. Defer repayments completely until you're earning.

You should be aware that as of 1 June 2006, any HECS debt you have has now become a HELP debt.

HECS-HELP options

  1. If you're lucky enough to be cashed up, you can get rid of the whole lot straight away and get a 10% discount. That translates as a whopping saving of $359.80 on a $3,598 full-time course in the first HECS-HELP band, such as nursing.
     
  2. Not so lucky in the wealth stakes? Make a part payment now of more than $500 and you'll still get a 10% discount on whatever you pay off. The more you can afford to pay off, the bigger the discount and the bigger the reduction on the debt you carry. For example, a $1,000 payment upfront would leave you with a debt of just $2,398 to clear when you start earning.
     
  3. Defer the whole payment until you're working. Although you may be feeling poor and disadvantaged if you're considering this option, it still has advantages. Firstly, you don't have to repay the debt until you can afford it. And secondly, there's no interest charged on your HECS-HELP loan.

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Deferring til you're earning: facts and figures

You only start repaying your HECS-HELP debt once your taxable income is greater than $41,594 a year (based on the 2008-09 financial year). Then 4% of your salary will be automatically deducted to repay your HECS-HELP fees. This will rise as your earnings do, to a maximum 8% of your salary when it hits $77,248. Remember, with HECS-HELP there's no interest charged on your loan, although it does increase in line with the CPI each year.

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Are you eligible?

To be eligible for HECS-HELP, you need to be an Australian citizen and satisfy the necessary requirements. For specific details click here.

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Youth Allowance and Austudy

Additionally, if you're at TAFE or uni full-time, you could be eligible for Youth Allowance or Austudy benefits to help you get by. Youth Allowance is for full-time students and apprentices who are 16 - 24, while Austudy is for full-time students and apprentices who are 25 or more. Both the Youth Allowance and Austudy are subject to income and assets tests. To see if you're entitled to these payments, as well as how you can maximise your income without losing any of the benefits you're entitled to, click here.

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