Student Loan Calculator

After entering your information, the student loan calculator provides a detailed snapshot of your future financial obligations:

• Monthly payment: The amount you'll pay each month to fulfill your loan obligations within the chosen term.
• Total repayment amount: The sum total you'll pay back over the loan's life, including principal and interest. This shows the full financial commitment you're making.
• Interest paid: How much you'll pay in interest alone over the repayment period. This represents the "extra" cost of borrowing and can help you decide whether to choose a shorter loan term.
• Principal paid: The original loan amount you'll have paid off at the end of the loan term.
• Amortization schedule: A detailed breakdown showing how each payment divides between principal and interest over time. This timeline reveals how your balance decreases and how much of your payments reduce your debt versus paying interest.

Several factors can affect your monthly student loan payments and total repayment amount:

• Repayment plan: Your repayment plan choice impacts your monthly payments and total repayment amount. Standard plans divide the loan into equal monthly payments, while income-driven plans adjust payments based on your income and family size. Each option affects your monthly budget and long-term financial health differently.
• Additional payments: Making extra payments directly reduces your principal amount, lowering the overall interest you'll accrue. This proactive strategy can shorten your loan term and save you money.
• Fees and penalties: Some loans include origination fees, late fees or prepayment penalties. These often-overlooked costs can add up over time. Understanding these charges and how to avoid them can make a noticeable difference in your total repayment amount.
• Grace periods and deferments: Some loans offer grace periods or deferments, letting you pause payments temporarily. While this provides short-term relief, interest may continue accruing, increasing your total repayment amount. Understanding the implications of these options on your long-term financial obligations is essential.

You have two main options for financing your education: private and federal student loans. Each has distinct features, benefits and drawbacks.

Banks, credit unions and other financial institutions offer private student loans. Interest rates can be fixed or variable and are often determined by your credit score—higher scores secure more favorable rates. Private loans may require a co-signer if you don't have an established credit history.

Repayment options for private student loans are less flexible, with fewer opportunities for deferment, forbearance or income-driven plans. Read the fine print and understand all terms before taking out a private student loan, as they offer fewer borrower protections.

The federal government funds federal student loans and offers more standardized terms and protections. They come with lower, fixed interest rates and various repayment plans tailored to your income and financial situation. 

Federal loans provide options for deferment, forbearance and loan forgiveness under certain conditions. Federal student loan types include:

• Direct subsidized loans: Available to undergraduate students with demonstrated financial need. The government pays the interest while you're in an in-school, grace or deferment period, making these loans cost-effective for students who may struggle to pay interest while in school.
• Direct unsubsidized loans: Available to both undergraduate and graduate students without requiring demonstrated financial need. You're responsible for all accrued interest starting from loan disbursement. This can cost you more long-term if you don't make interest payments while in school.
• Direct PLUS loans: Aimed at graduate students or parents of dependent undergraduate students. They have higher interest rates and require a credit check but allow you to borrow up to the full cost of attendance. They're a good option for bridging the gap between other financial aid and total education costs.
• Direct consolidation loans: Allow you to combine multiple federal student loans into a single loan with a fixed interest rate based on the weighted average of the combined loans, rounded up to the nearest one-eighth of a percent. Consolidation can simplify payments but may extend your repayment period, leading to more interest paid over time.

Managing student loan payments can burden your finances, but strategies exist to make it more manageable. Here are ways to lower your monthly payments:

• Income-driven repayment plans: Income-Based Repayment (IBR), Pay As You Earn (PAYE), Saving on a Valuable Education (SAVE) and Income-Contingent Repayment (ICR) adjust your monthly payments based on your income and family size. Available for federal student loans, these plans forgive any remaining balance after a set number of years, making them a long-term loan management strategy.
• Refinancing: Taking out a new loan with a private lender to pay off your existing loans, ideally at a lower interest rate. Refinancing can lower your monthly payments, but you may lose federal loan benefits like income-driven repayment plans and loan forgiveness options.
• Extended repayment plans: Extending your loan term can reduce your monthly payments considerably. While this eases immediate financial strain, it results in more interest paid over the loan's life. You're trading short-term relief for long-term cost.
• Student loan forgiveness programs: Various programs forgive a portion or all of your federal student loans, often in exchange for certain types of employment or public service. Qualifying for these programs can reduce or eliminate your monthly payments, offering powerful long-term financial relief.

Here are frequently asked questions about student loans to help you make financially sound educational decisions.