How it works
The payment formula
On a standard fixed plan your monthly payment is:
payment = P × r(1 + r)n / ((1 + r)n − 1)
where P is the balance, r is the annual rate ÷ 12 ÷ 100 and n is the number of monthly payments. Total interest = payment × n − P.
Extra payments
With an extra amount, the calculator simulates each month — interest = balance × r, then the regular payment plus the extra is subtracted — until the balance is gone. Extra payments go straight to principal, so less interest accrues every month afterward.
Assumptions
- A single loan (or a consolidated weighted-average rate) with a fixed rate.
- Payments start now; no deferment, forbearance or capitalized interest.
- Income-driven repayment plans, forgiveness programs and federal rate discounts (such as autopay) are not modeled.
Worked examples
$30,000 at 6.53% over 10 years
Monthly payment: $341.10; total interest $10,932.24. Adding $100 a month pays it off in 86 months (7 years 2 months) and saves $3,365.27.
$65,000 at 7.94% over 20 years, with $250 extra per month
Standard payment: $541.26 with $64,902.73 of interest over 240 months. With $250 extra the loan is gone in 119 months (9 years 11 months), saving $35,806.32.
Federal vs. private student loans
Federal loans have fixed rates set each year by law, the option of income-driven repayment, deferment and forbearance, and potential forgiveness programs such as Public Service Loan Forgiveness. Private loans may have fixed or variable rates set by the lender based on credit, and usually fewer repayment protections. Refinancing federal loans into a private loan can lower the rate but permanently gives up federal benefits.
Strategies to pay off student loans faster
- Add a little extra every month. In the first example, an extra $100 per month cuts 34 months off the loan and saves $3,365.27 in interest.
- Target the highest-rate loan first if you have several (the avalanche method). See the debt payoff comparison.
- Enroll in autopay. Federal servicers and many private lenders offer a 0.25% rate discount.
- Make sure extra payments go to principal. Ask your servicer to apply them to the current balance rather than advancing your due date.
- Use windfalls. Tax refunds and bonuses applied to principal shorten the loan.
- Know your options if money is tight. Income-driven plans can lower payments, though usually with more total interest.
Reading your results
Monthly payment is the fixed amount that repays the loan over your chosen term. Total interest is everything you pay beyond the original balance. When you enter an extra payment, the results also show the new payoff time and how much interest you avoid. The chart plots both balances so you can see how much sooner the extra-payment line reaches zero.
How interest accrues on student loans
Most student loans use simple daily interest: the annual rate divided by 365, multiplied by the outstanding principal, accrues each day. Over a month this is very close to the monthly calculation used here. Interest that goes unpaid during school, deferment or forbearance may be capitalized — added to the principal — which raises future interest charges. If your loan is about to enter repayment, check whether unpaid interest will be capitalized and use the higher balance in the calculator.
Choosing a repayment term
A longer term lowers the monthly payment but increases total interest, sometimes dramatically. Compare a 10-year and a 20-year term with the same balance and rate to see the trade-off. If cash flow is tight now but you expect your income to grow, one approach is to choose a manageable required payment and then add voluntary extra payments as your budget allows — as long as your loan has no prepayment penalty (federal loans and most private student loans do not).
Frequently asked questions
How is a student loan payment calculated?
Using the standard amortization formula with your balance, monthly interest rate and number of payments. A 10-year standard plan has 120 payments.
Do extra payments really make a difference?
Yes. Every extra dollar reduces principal immediately, so less interest accrues. On $30,000 at 6.53%, $100 extra a month saves $3,365.27.
Should I pay off student loans or invest?
Many people compare the loan rate to expected after-tax investment returns. Paying off a 7%+ loan is a guaranteed return; lower-rate loans may favor investing, especially to capture an employer 401(k) match first.
Does this include income-driven repayment?
No. Income-driven payments depend on income, family size and plan rules. Use the official Federal Student Aid loan simulator for those plans.
What if I have several loans?
Enter the total balance and a weighted-average rate for an estimate, or run each loan separately. The debt payoff comparison handles up to five debts.
Is student loan interest tax-deductible?
You may be able to deduct up to $2,500 of student loan interest per year, subject to income limits. This calculator does not include the deduction.
What happens to interest during deferment?
For many loans, interest keeps accruing during deferment or forbearance and may be capitalized (added to principal) when repayment begins, increasing the total cost.