Erin Constable: Govt’s plan to wipe 20 per cent off student debts punishes those who try to do the right thing

Determination to never be in debt has left me $8000 worse off — and it’s all because of a vote-grabbing federal budget.

I’ve lost out on $8000 and it’s all because I was financially responsible.

Debt conjures up sickening mental images of financial ruin, of collectors coming knocking and eviction notices stuck to the door.

There are dire warnings about the poor financial literacy of Gen Z and a litany of news articles saying they’ll never afford their own home, let alone on a single salary.

It’s too much avocado on toast, too many big nights out, too much buy-now-pay-later.

But I took heed, determined they’d be wrong.

Hours were spent meticulously budgeting every dollar earned and spent.

Pandemic-era university years were marked by mornings studying, and afternoons and evenings manning Aldi registers.

Clocking 35 hours of paid work, there were also unpaid internships and time volunteering at the university’s news website — all with the aim of a guaranteed job in journalism by graduation.

In five years, there was one four-day interstate trip to help my parents move house — hardly a holiday.

They were sacrifices all willingly made in the pursuit to be debt free.

And, a year after graduation, the last of a $42,000 HELP debt was paid off — some $39,000 more than the annual compulsory repayment.

But I’m now starting to regret all that planning, budgeting and hard work.

On Tuesday, the Albanese government re-announced it would wipe 20 per cent from all existing student debt.

Instead of being rewarded for paying off my debt much earlier than scheduled, I will be punished to the tune of $8000.

That amount of money would go a very long way for a 23-year-old who lives out of home during a crippling cost-of-living crisis.

It could be the start of that “impossible” house deposit. It could pay my rent for nine whole months.

Cutting student loan debts will help thousands of people — including the vast majority of my friends.

Ridiculous student loan indexation fees, a struggling job market and the slow chew of inflation make a strong case for giving everyday Australians a break.

But this plan lacks consideration for those who tried to do the right thing.

It completely ignores those who succeeded.

The government claims it is “making the student loan repayment system fairer” but changing the rules on a whim to lure in younger, financially strapped voters is clearly an election ploy.

It doesn’t feel “fairer” to me.