Most students enter college when they’re 18 or 19 years old. Student loan repayment may seem a long way off at that age, but you may be surprised at how quickly the payments become due — and how long you’ll be in repayment.
When will my student loan be paid off? That’s a common question, especially as student loan statistics show the average balance per borrower reached $39,032 in 2022. Typical repayment periods can range from five to 25 years, but how long it will take to repay your loans depends on your loan type, student loan interest rate, payment plan and whether you use an alternative payment plan during the life of the loan.
Student Loan Payoff Calculator
How To Use The Payoff Calculator
Use the student loan payoff calculator to determine how long it will take to repay your loans and how much you’ll pay with interest over time. To use the calculator, enter the following information:
- Annual percentage rate (APR): The APR is how much you pay in interest and fees in a year, represented as a percentage. Rates can vary, but a higher rate will cause more interest to accrue (and higher monthly payments).
- Outstanding loan amount: The current loan amount may differ from the amount you initially borrowed, thanks to interest capitalization. To find your student loan balance, contact your loan servicer or view your credit report at AnnualCreditReport.com.
- Current monthly payments: Your monthly payment is the minimum amount the lender requires you to pay each month. Depending on your loan type and interest rate, the payment amount may be fixed or variable. Viewing your most recent loan statement, you can find your current monthly payment.
- Extra payments (if applicable): Student loan companies cannot charge prepayment penalties, so making additional payments is an excellent way to save money and pay off your loans faster. You can save a significant amount of money if you can afford to pay a little extra each month — even just $10 or $20.
Student Loan Repayment Factors
When you take out a loan, you sign a loan agreement or promissory note that outlines key details like the loan term, principal and APR. With federal student loans, the standard repayment plan — the default for all borrowers — is ten years in length. By contrast, private student loan lenders let you choose your term, and it can range from five to 25 years.
However, other factors can affect how long you’re in repayment besides whether your loans are federal or private student loans. For example:
- Grace period: With most federal student loans and some private loans, borrowers don’t have to make payments until six months after they graduate or leave school, and the repayment term begins only after the grace period ends. If a borrower decides to make payments during the grace period, even if they pay a reduced amount, they can accelerate their loan repayment.
- In-school payments: Although most federal loans don’t require borrowers to make payments while the student is in college, private loans work differently. Depending on which in-school option you choose, you may have to make full or partial payments while the student is in school. If you opt for a smaller payment or defer payments until after graduation, the loans will be in repayment longer and you’ll pay more interest.
- Alternative payment plans: If borrowers cannot afford their payments, they may be eligible for an alternative payment plan. These plans may reduce the payment and extend the loan term, adding years to your total repayment time.
- Deferment or forbearance: If you return to school, become ill or lose your job, you may be able to defer your payments or enter forbearance, meaning you can postpone your payments without becoming delinquent. If you do, pause the loan for several months or even years, but the loan payoff date will be pushed back and interest may continue to accrue.
- Additional payments: Making additional payments, either as a lump sum or by increasing your monthly payment amount, will reduce the amount of interest accrues. As a result, your loan term can be shortened by months or even years.
Student Loan Repayment Plans
When will my student loan be paid off? The answer to that question largely depends on your chosen repayment plan. What options are available to you vary by loan type.
Federal Student Loans
With federal student loans, the default repayment plan is 10 years with fixed monthly payments. However, borrowers with federal Direct loans that cannot afford their payments may be eligible for one of the following income-driven repayment (IDR) plans:
- Income-Based Repayment (IBR): If you are a new borrower on or after July 1, 2014, you will pay 15% of your discretionary income and have a term of 25 years, but your payment will never exceed the payment amount under a 10-year standard repayment plan.
- Income-Contingent Repayment (ICR): Under ICR, borrowers pay the lesser of 20% of their discretionary income with a 25-year term or an adjusted fixed payment amount with a 12-year repayment term.
- Pay As You Earn (PAYE): PAYE has a 20-year term, and borrowers pay 10% of their discretionary income. However, their payments will always be at most what the payments would be under a 10-year standard repayment plan.
- Revised Pay As You Earn (REPAYE): Under REPAYE, the new loan term is 20 years for undergraduate and 25 years for graduate loans. Borrowers pay 10% of their discretionary income.
With the IDR plans, the government will forgive the remaining balance if you reach the end of the new loan term and still owe money. And all IDR plans are qualifying payment plans for PSLF.
However, not all federal loan borrowers are eligible for IDR plans. If you have other federal loans, you may qualify for one of the following plans instead:
- Graduated repayment: Payments start low, but increase every two years. Most loans are repaid in 10 years, but loans consolidated with a Direct Consolidation Loan can be in repayment for up to 30 years. This option is available to all federal loan types.
- Extended repayment: Only available to borrowers with at least $30,000 in outstanding Direct loans, extended repayment lengthens the loan term to 25 years. Payments may be fixed or graduated.
- Income-sensitive repayment: Income-sensitive repayment is a plan only available to borrowers with Federal Family Education Loans that aren’t eligible for Public Service Loan Forgiveness. This plan adjusts your payments based on your income and extends the loan term up to 15 years.
[Tip: President Biden recently announced the launch of a new repayment plan, SAVE. This plan would decrease payments for many federal loan borrowers. For more information, visit the Federal Student Aid website.]
Private Student Loans
With private student loans, you typically choose a loan term and an in-school payment plan. Depending on the lender, you may have the following options:
- Immediate: You make full monthly payments immediately after the loan is disbursed.
- Interest-Only: You make payments that cover the monthly accrued interest while you’re in school, then full payments after you graduate or leave college.
- Flat: With a flat repayment plan, you pay a fixed amount, such as $25, every month while you’re in college. After graduation, you make payments against the interest and principal.
- Deferred: For borrowers that don’t want to make any payments while in school, deferred repayment allows them to postpone payments until after graduation.
How Do Extra Payments Help Pay Off Your Student Loan Faster?
Whether you have private or federal loans, making extra payments can be an excellent way to pay off debt faster and save money. When you make additional payments, you chip away at the principal and reduce the amount of interest that accrues.
Small payments can make a big difference. For example, if you have $20,000 in loans at 6.00% interest and a 10-year repayment term, your monthly payment would be $222.
If you increased your payment by $25, your new monthly payment would be $247. Although that’s not a huge difference, those extra payments would allow you to pay off your loans 15 months sooner and save $946 in interest.
| Minimum Payment Only | Payment With Extra $25 | |
| Payment Amount | $222 | $247 |
| Time in Repayment | 120 months | 105 months |
| Total Repaid | $26,647 | $25,701 |
| Savings | Not applicable | $946 |
When making extra payments, contact your loan servicer and provide them with instructions on how to use the additional money. Tell the servicer you want it applied to the loan principal; otherwise, they may credit it to a future payment.
Opportunities For Paying Off Student Loan Faster
Finding the money to pay off your loans faster may seem challenging. But here are a few ways you can find money to put toward your debt:
Tax Refunds
The majority of taxpayers receive a refund. For the 2022 tax year, the average tax refund was $2,812. If you qualify for a refund, consider using it to make a lump sum payment toward your loans; it could help you pay off your loan much sooner and save more money.
Windfalls
You receive cash for your birthday. Or you get a bonus at work. Or perhaps you get a refund from your insurance company. Whatever the case may be, unexpected windfalls can be excellent opportunities to repay your loans. Since you weren’t expecting the windfall, it doesn’t hurt your other savings goals, and the windfall can reduce your debt.
Extra Income
Although it may not be possible for everyone, increasing your income is another way to accelerate your loan repayment.
You may be eligible for a pay raise or overtime pay. But if those are not options for you, another way to earn extra money is to start a side hustle. According to Zippia, the average earnings for side hustles was $483 per month. If you made that much and put all your side gig earnings toward your loans, you could save thousands and get out of debt months or even years sooner.
Are There Penalties For Paying Off Your Student Loan Early?
With some forms of debt, lenders can charge you a penalty or fee if you pay off the loan before the loan agreement’s end date. However, these fees — known as prepayment penalties — aren’t permitted on student loans.
Federal law prohibits federal and private student loan companies from charging any penalties for early repayment. So you can make extra payments and pay off your student loans ahead of schedule without incurring added fees.
Refinance Your Student Loan with ELFI
Student loan refinancing is another way to reduce your debt. If you have good credit, you may qualify for a lower rate of interest with a lender like ELFI. Going forward, more of your payments will go toward your loan’s principal. Over time, you could save a significant amount of money and become debt-free sooner.
Refinancing has some drawbacks; federal loan borrowers will lose the government’s protections and repayment options. But that tradeoff may be worth it for those focused on paying off their debt as quickly as possible.
