Three questions this page answers
Student debt gets discussed as one number, but borrowers actually ask three different questions at three different points in their lives, and each needs its own arithmetic. The tabs at the top of the page split them out.
- Monthly Payment. You already owe a balance and want the payment, the payoff term, the affordable balance or the implied rate. Fill in any three of those four boxes and the empty one is worked out.
- Payoff and Extra Payments. You are repaying now and want to know what an extra amount each month, an annual bonus, or one lump sum would actually buy you in time and interest.
- Still in School. You are studying or about to start, and want to know what the balance will have grown to by the time the first bill arrives.
Nothing you type is sent anywhere. All three run entirely in your browser.
The formula behind the payment
A student loan on a standard plan is an ordinary amortizing loan, so the payment comes from the same equation used for a mortgage or a car loan:
Here M is the monthly payment, P is the balance outstanding, r is the annual rate divided by twelve, and n is the number of monthly payments left. Taking the default figures on this page — $27,500 at 6.52% over 12 years — r is 0.0054333 and n is 144, which gives a payment of $275.82. Multiply that by 144 and the total repaid is $39,717.69, of which $12,217.69 is interest.
The same equation rearranges. Solving for n gives the payoff term from a payment you choose; solving for P gives the balance a given payment can support; solving for r has no closed form, so the calculator narrows in on the answer numerically. That is what happens when you leave one of the four boxes empty.
Two details separate this from a textbook example. Federal loans accrue daily simple interest rather than monthly, so a payment that lands a few days ahead of the due date shaves a little off the balance. And every payment settles accrued interest before touching principal, which is why the first year of a long loan clears so little of the balance — the year-by-year table under the calculator makes that split visible.
What changed for federal borrowers on July 1, 2026
The One Big Beautiful Bill Act, signed in July 2025, rewrote federal repayment, and most of it took effect on July 1, 2026. Any calculator or article written before that date describes a system that no longer applies to new borrowers, so it is worth being specific about what is now true.
- A new tiered Standard plan. The old flat ten-year Standard plan is replaced for new borrowers by fixed payments over a term set by how much is owed: 10 years under $25,000, 15 years from $25,000 to under $50,000, 20 years from $50,000 to under $100,000, and 25 years above that.
- The Repayment Assistance Plan. RAP is the single income-driven option for loans first disbursed on or after July 1, 2026. Payments are 1% to 10% of adjusted gross income, with a $10 minimum and a $50 reduction per dependent, and forgiveness comes after 30 years.
- ICR, PAYE and SAVE are being retired. They disappear for everyone by July 1, 2028. Income-Based Repayment survives, but only for loans taken out before July 1, 2026.
- Grad PLUS is gone for new borrowers, and graduate borrowing is capped at $100,000 over a lifetime, or $200,000 for certain professional programs.
- Parent PLUS is capped at $20,000 a year for each dependent student and $65,000 in total.
This calculator models the mechanics of a fixed-payment loan, which is what both the tiered Standard plan and any private loan amount to. It does not model RAP, because an income-driven payment depends on your adjusted gross income and family size rather than on the balance, and it changes every year as your income does.
Rates and limits for 2026–27
Federal rates reset every July 1, derived from the ten-year Treasury note auction held the previous May plus a fixed statutory margin. The May 12, 2026 auction produced a 4.468% high yield, which sets these rates for loans first disbursed between July 1, 2026 and June 30, 2027:
| Loan type | Fixed rate | Origination fee |
|---|---|---|
| Direct Subsidized & Unsubsidized (undergraduate) | 6.52% | 1.057% |
| Direct Unsubsidized (graduate) | 8.07% | 1.057% |
| Direct PLUS (parent) | 9.07% | 4.228% |
Each rate is fixed for the life of that particular loan, so a borrower who took loans out across four academic years is usually carrying four different rates at once. When you have several loans and want one figure, using a balance-weighted average rate in the calculator gets you close; when you are deciding which loan to overpay, run the highest-rate one on its own instead.
Borrowing limits still bite before the rates do. Dependent undergraduates can take $5,500 to $7,500 a year in Direct loans depending on year of study, up to $31,000 in total. Independent undergraduates reach $57,500, of which no more than $23,000 may be subsidized. The origination fee is deducted before the money reaches the school, so borrowing $9,500 delivers about $9,400 of usable funds while the full $9,500 accrues interest.
Federal against private loans
Federal loans come with fixed rates set by statute rather than by credit score, no cosigner requirement for undergraduates, access to income-driven repayment and forgiveness programs, and deferment options if things go wrong. Private loans compete on one thing: for a borrower with strong credit or a creditworthy cosigner, the rate can be lower, sometimes markedly so for graduate borrowers now that Grad PLUS at 9.07% has gone.
That is a real trade, not an obvious one. A private loan at 5% instead of a federal loan at 8.07% saves meaningful money on a $50,000 balance, and gives up income-driven repayment, forgiveness eligibility and federal deferment protections in exchange. The lower rate is worth most to borrowers with stable, predictable earnings; the federal protections are worth most to everyone else. Refinancing federal debt into a private loan is the same trade, made irreversible.
What the grace period actually costs
The six-month grace period on Direct loans delays your first bill. It does not pause interest on anything except subsidized loans, where the government covers it. On unsubsidized and PLUS loans, interest accrues from the day of disbursement, keeps accruing while you study, keeps accruing through the grace period, and is then capitalized — added to the principal, so that from that point on you pay interest on the interest.
The Still in School tab shows the size of that effect. Borrowing $9,500 a year for three more years on top of $14,000 already borrowed comes to $42,500 of actual borrowing. Left to accrue at 6.52%, the balance reaches $48,400.04 by graduation and $49,999.47 by the time repayment starts — $7,499.47 added before a single payment. Repaid over 12 years, the monthly payment is $501.48 and the interest bill across the whole loan is $29,713.23.
Switching the in-school toggle to Yes models paying that interest as it accrues, which is usually a modest amount each month while you are studying and is the single cheapest thing an unsubsidized borrower can do. It stops the capitalization event entirely, so repayment begins against the amount actually borrowed rather than an inflated balance.
What extra payments really buy
Because the scheduled payment was fixed when the term was set, extra money does not reduce next month's bill. It reduces principal, which removes all the future interest that principal would have generated, and brings the payoff date forward.
The default figures on the Payoff tab show the shape of it: $27,500 at 6.52%, paying $310 a month, runs 10 years and 2 months and costs $10,130.66 in interest. Adding $125 a month clears it in 6 years and 6 months and costs $6,282.50 — 3 years and 8 months earlier, and $3,848.16 saved. The extra $125 is not being compared against nothing; it is buying the removal of nearly four years of interest charges.
Three practical points. Extra payments have to be designated to principal in writing, or many servicers will simply advance your due date and credit the money against future bills, which achieves almost nothing. Federal loans carry no prepayment penalty, so there is no downside to the timing. And if you are pursuing Public Service Loan Forgiveness, the arithmetic inverts entirely: overpaying reduces a balance that was going to be written off, so the money is better placed almost anywhere else.
What to put in each box
- Loan balance. The principal still outstanding on your latest statement, not the amount originally borrowed and not including interest that has not yet capitalized.
- Remaining term. What is left of the repayment period, not its original length. A borrower three years into a ten-year plan enters 7.
- Interest rate. The annual rate on the statement, entered as a percentage. For several loans at once, a balance-weighted average is a reasonable approximation.
- Monthly payment. The scheduled payment, excluding anything extra you choose to add — the extra goes in its own boxes on the Payoff tab.
- Borrowing each year. On the Still in School tab, what you expect to take out per academic year from here on, not the running total.
- Grace period. Six months on Direct loans. Private lenders vary, and some have none at all.
What this calculator does not cover
- Income-driven repayment. RAP and IBR payments depend on adjusted gross income and family size, and are recalculated annually. A fixed-payment model cannot represent them.
- Forgiveness. Neither PSLF after 120 qualifying payments nor the 30-year RAP write-off is modeled here, and both change the value of overpaying dramatically.
- Origination fees. The 1.057% and 4.228% fees are deducted at disbursement rather than added to the balance, so they raise your effective cost without appearing in these figures.
- Variable rates. Every calculation assumes a fixed rate. Some private loans are variable and will drift.
- Deferment, forbearance and missed payments. Any pause in repayment lets interest continue accruing on unsubsidized debt and lengthens everything.
- Multiple loans at different rates. Run them separately, or use a balance-weighted average rate and accept some imprecision.
Frequently asked questions
How much will my student loan payment be?
On the standard amortization used by federal servicers, a $27,500 balance at 6.52% over 12 years works out at $275.82 a month, and $39,717.69 repaid in total. Shorten the term and the monthly figure rises but the interest falls; stretch it and the reverse happens. The Monthly Payment tab above does this from your own balance, rate and remaining term, and it will solve for any one of the four figures if you leave that box empty.
How is interest calculated on a student loan?
Federal student loans use daily simple interest on the outstanding principal. Take the annual rate, divide it across 365 days, and apply the result to whatever you owe that day: a $27,500 balance at 6.52% picks up roughly $4.91 daily, which comes to about $147 over a 30-day month. Your payment settles that accrued interest first and only what is left over reduces principal, which is why the early years of a loan clear so little of the balance.
What is the average student loan payment?
Around $400 a month is the figure usually quoted for federal borrowers on a standard plan, though it varies enormously by degree and debt level. It is a weak benchmark to plan against, because the payment that matters is the one your own balance, rate and term produce. Someone with $15,000 from a state school and someone with $90,000 from a professional program both sit inside that average and face completely different bills.
Does paying extra on student loans lower the monthly payment?
No, and this catches people out. Extra payments shorten the loan rather than shrink the bill, because the scheduled payment was fixed when the term was set. Adding $125 a month to a $310 payment on $27,500 at 6.52% clears the debt in 6 years and 6 months instead of 10 years and 2 months and saves $3,848.16 of interest, but the required payment stays $310 throughout. Tell your servicer in writing to apply anything extra to principal, or it may simply be credited against next month's bill.
What is the grace period on a student loan?
Six months for Direct loans, counted from the day you graduate, leave, or drop below half-time enrollment. It delays the first bill; it does not stop interest. On unsubsidized loans interest accrues throughout and is then capitalized, meaning it is added to the principal so that future interest is charged on the larger figure. On our default projection that grace period alone adds a little over $1,500 to the balance before a single payment is made.
What is the Repayment Assistance Plan?
RAP is the income-driven plan created by the One Big Beautiful Bill Act, available from July 1, 2026. Payments run from 1% to 10% of adjusted gross income with a $10 monthly minimum, reduced by $50 for each dependent, and any remaining balance is forgiven after 30 years. It also prevents negative amortization: if a payment does not cover the month's interest, the unpaid portion is not added to the balance. For anyone borrowing after that date, RAP is the only income-driven option available.
What are the federal student loan interest rates for 2026-27?
For loans first disbursed between July 1, 2026 and June 30, 2027, Direct Subsidized and Unsubsidized loans for undergraduates carry 6.52%, Direct Unsubsidized loans for graduate students carry 8.07%, and Direct PLUS loans carry 9.07%. They are set from the May 2026 ten-year Treasury auction, which came in at a 4.468% high yield, plus a statutory margin. Each rate is fixed for the life of that loan, so a student who borrows across four years usually ends up holding four different rates.
Should I pay off student loans early or invest the money?
Compare the loan rate against what the money would reliably earn elsewhere, after tax. Paying down a 9.07% PLUS loan is a guaranteed 9.07% return and is hard to beat; overpaying a 4.5% loan from an older year while skipping an employer retirement match gives up a larger, more certain gain. Two things change the arithmetic: if you are working towards Public Service Loan Forgiveness, every extra dollar reduces what would have been written off, and if you have no emergency fund, money sent to a servicer cannot be borrowed back.
This is an educational estimate, not financial advice. Results assume a fixed interest rate, payments made in full and on time, and no origination fees, deferment or forbearance. Income-driven plans such as RAP and IBR, and forgiveness programs such as PSLF, are not modeled. Federal rules changed on July 1, 2026 and continue to be implemented, so confirm anything decision-critical against your servicer or StudentAid.gov before acting on it. More about how we build and check these tools is on our About page, and our Privacy Policy explains what we do and do not collect — nothing you type here leaves your browser.