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My Work Benefit, Season Ticket Loan: A Case Study

By: Maggie Lonsdale BA (hons) - Updated: 4 Sep 2012 | comments*Discuss
 
Season Ticket Interest-free Public

Many companies in London offer their full-time staff season ticket loans as part of the benefits package for the job. A season ticket loan refers to help with the cost of buying a public transport pass for 12 months.

With the cost of a 12-month season ticket costing up to £2,708, it is very difficult for employees to pay for a season ticket out of their normal salary, so companies often offer an interest-free loan for the full amount, which is then paid back in monthly instalments.

Abbey Simmons, an events planner for a legal company, moved to London to start her new position and was offered the interest-free loan from her employers. She told us, “I was moving from Leeds to London as I had been offered a position in the law firm’s city office. I was initially going to be living in a rented flat in Tooting, south London, while I decided how I felt about living and working in London.”

Understanding the Terms

Having not spent much time in London before, Abbey was not aware of the cost of public transport and was interested in the season ticket offer from her employers.

She continued, “As Tooting is in Zone 4, I needed to buy a Zone 1- 4 travel card. I was initially buying daily travel cards because I wasn’t really sure how it all works, but a colleague of mine told me to get a monthly card as it would save money. As the daily travel card was costing me £5.60 and the monthly card was £144, I could see that I would save money, especially as I planned to use public transport at the weekends, too. I was talking to my manager about this and she told me about the company’s interest-free season ticket loan to help me buy an annual pass, which at £1,472 was another considerable saving. I made an appointment to speak to the HR manager about it.”

Abbey was told that she was entitled to the interest-free season ticket loan and would need to pay it back at one twelfth of the total cost per month, taken directly from her salary. She was informed that if she left the company for any reason, the total amount would be payable within 60 days.

Practical Consideration

Abbey explained, “I decided to go for it because it was becoming so frustrating to be paying for a ticket each month, knowing that I could be saving money. It also saved me time because the queues for the ticket booth were often busy and inevitably I would be in a rush when I realised my ticket had run out! One colleague actually decided not to get the loan because she knew that she may be asked to spend quite a few days a month at other offices and thought it would not work out cost effective. The only thing that put me off was the thought of losing the ticket – so I made sure I photocopied it for proof in case anything happens, and I guard it with my life!”

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