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Student Loan Calculator

Calculate monthly payments and total costs for federal and private student loans

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Understanding Student Loans

Student loans come in two main types: federal loans (from the government) and private loans (from banks or other lenders). Federal loans typically offer lower interest rates, flexible repayment options, and borrower protections like deferment and forbearance.

Standard repayment for federal loans is 10 years, but you may qualify for income-driven repayment plans that extend the term to 20-25 years based on your income. Private loans typically have fixed 5-20 year terms with repayment starting immediately or after graduation.

Interest on student loans accrues daily based on your outstanding balance. For unsubsidized loans, interest begins accruing immediately. For subsidized federal loans, the government pays interest while you're in school at least half-time.

Smart Student Loan Strategies

  • Exhaust federal loans first: Federal loans have better terms, protections, and forgiveness options than private loans.
  • Pay interest while in school: Even small payments prevent capitalization (interest added to principal).
  • Consider income-driven plans: If federal loans, you may qualify for monthly payments based on your income.
  • Explore forgiveness programs: Public Service Loan Forgiveness and teacher loan forgiveness can eliminate federal debt.
  • Refinance high-rate private loans: If you have good credit, refinancing can lower your rate and save thousands.

Student Loan FAQs

What's the difference between subsidized and unsubsidized federal loans?

Subsidized loans don't accrue interest while you're enrolled at least half-time, during your grace period (first 6 months after graduation), or during deferment periods. The government pays the interest for you. Unsubsidized loans accrue interest from the day they're disbursed, and you're responsible for all interest. Subsidized loans are need-based and have borrowing limits; unsubsidized loans are available regardless of financial need.

Should I pay off student loans early?

It depends on your interest rate and other financial priorities. If you have high-interest private loans (7%+), paying them off early saves significant money and frees up cash flow. However, federal loans often have lower rates (4-6%) and offer unique benefits like forgiveness programs. Consider paying off high-interest debt (credit cards) and building an emergency fund before aggressively paying down low-rate federal student loans.

What are income-driven repayment plans?

Income-driven repayment (IDR) plans cap your monthly federal student loan payment at 10-20% of your discretionary income. There are four plans: SAVE (formerly REPAYE), PAYE, IBR, and ICR. Payments adjust annually based on your income and family size. After 20-25 years of payments, any remaining balance is forgiven (though the forgiven amount may be taxable). These plans are only available for federal loans, not private loans.

Can I refinance federal student loans?

Yes, but think carefully before doing so. Refinancing federal loans with a private lender can lower your interest rate if you have good credit, potentially saving thousands. However, you'll lose federal benefits: income-driven repayment, loan forgiveness programs, flexible deferment/forbearance, and other borrower protections. Only refinance federal loans if you don't need these protections, have stable income, and can get a significantly lower rate (at least 1-2% reduction).

How much student loan debt is too much?

A common rule of thumb: don't borrow more than your expected first-year salary after graduation. If you expect to earn $50,000, limit total loans to $50,000. This ensures your monthly payment (on a 10-year plan) stays around 10% of your gross income. Borrowing more means financial stress, delayed life milestones (buying a home, starting a family), and difficulty paying other bills. If you need to borrow more, seriously consider a less expensive school or working while in school.

What happens if I can't make my student loan payments?

For federal loans, contact your loan servicer immediately. You may qualify for deferment (pause payments while interest may accrue) or forbearance (temporary payment reduction/suspension). You can also switch to an income-driven repayment plan for lower monthly payments. For private loans, contact your lender to discuss hardship options, though they're less generous than federal options. Never ignore the problem—defaulting damages your credit for years and can lead to wage garnishment.