Student Loan Calculator
Calculate your student loan monthly payments and total repayment costs. Compare different repayment terms to find the best strategy for paying off your federal or private student loans. See how extra payments can save you money and help you become debt-free faster.
How to Use This Student Loan Calculator
1. Enter your total student loan balance (combine all loans or calculate them separately).
2. Input your interest rate. Federal undergraduate loans are typically 5-7%, while private loans range from 3-14%.
3. Select your loan type to see relevant repayment options.
4. Choose your repayment term. The standard term is 10 years, but extended plans offer lower monthly payments.
5. Add any extra monthly payment you can afford to see how it reduces your payoff time and interest.
6. Enter your expected salary to see what percentage of income goes to loan payments.
What are Student Loans?
Student loans are borrowed money used to pay for higher education expenses including tuition, room and board, books, and living expenses. There are two main types: federal student loans (offered by the government with fixed rates and borrower protections) and private student loans (offered by banks, credit unions, and online lenders with variable or fixed rates).
Federal loans offer income-driven repayment plans, deferment options, and potential loan forgiveness programs. Private loans typically have fewer protections but may offer lower rates for borrowers with excellent credit. Understanding your loan type is crucial for choosing the right repayment strategy.
- Federal Direct Loans: Fixed rates set by Congress, income-driven options available
- PLUS Loans: For parents or graduate students, higher rates than Direct Loans
- Private Loans: Credit-based rates, fewer borrower protections
- Refinancing: Combine multiple loans into one with potentially lower rates
Student Loan Payment Formula
The standard monthly payment is calculated using the amortization formula:
M = P[r(1+r)^n]/[(1+r)^n-1]
Where: M = Monthly payment, P = Principal (loan balance), r = Monthly interest rate (annual rate / 12), n = Total number of payments.
Financial experts recommend keeping student loan payments below 10% of your gross monthly income. If your payment exceeds this threshold, consider income-driven repayment plans or refinancing options to make your debt more manageable while still making progress toward payoff.