Ask Paul: Should I save for a house or pay off my HELP debt?


Dear Paul,

I've been working for a little while since graduating, but I have a large HELP debt. My priority is to save to buy a house, but I also want to contribute to super and I'm conscious of reducing the student debt because of indexation.

I'm unsure if I should focus on saving a deposit and/or contribute to super and reduce my debt. - Josh

ask paul clitheroe should i save for a house or pay off my hecs debt

You know, Josh, if anyone will lend me money as a HELP debt, which they won't, I'd take as much as I could get.

Sure, it is indexed, but you only have to pay it back as your salary goes up, and it can sit there forever with no interest repayments.

I'd prefer you to save for a deposit rather than pay off your student debt or build your super.

You can't touch your super money for decades and who knows what super rules will apply in 2063!

Your call. But I'd ask you to do the numbers on saving for a deposit and buying a well-located home.

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Paul Clitheroe AM is founder and editorial adviser of Money magazine. He is one of Australia's leading financial voices, responsible for bringing financial insight to Australians through personal finance books, the Money TV show, and this publication, which he established in 1999. Paul is the chair of the Australian Government Financial Literacy Board and is chairman of InvestSMART Financial Services. He is the chair of Financial Literacy at Macquarie University where he is also a Professor with the School of Business and Economics. Ask Paul your money question. Unfortunately Paul cannot respond to questions posted in the comments section. View our disclaimer.
Money magazine
November 8, 2023 9.45am


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kay lloyd
November 8, 2023 4.46pm

Yes Paul did answer a question of mine and he was right, the shares did start to pay dividends again!

Mandy Higgins
November 10, 2023 2.55pm

Josh, what Paul said is technically right (regarding HELP debt being the best loan debt you could possibly have). But having a large debt is still a debt nonetheless - and those big numbers staring at you on every pay slip (like it did for me) really bugged me out. So I did a part HELP payment and saved for a deposit as well. I know some uni mates who saved for a deposit only. Somehow we all ended up getting a house around the same time or even later! Turns out while I was paying my HELP debt, they were going on holidays and buying big ticket 'feel good" items. So while they still have their HELP debt even to this day, I don't. That 'paying debt off early mentality' I learnt then actually helped me to also pay off my home loan off faster than my mates could. I guess it's different for everyone.