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Student Loan Repayment Calculator

Calculate fixed monthly student loan payments, total interest, and payoff timeline using the standard amortization formula for federal and private loans.

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Inputs

Loan Balance

Annual Interest Rate

Repayment Term

Monthly Payment

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Monthly Payment—

The formula

How the
result is
computed.

How the Student Loan Repayment Calculator Works

The Student Loan Repayment Calculator applies the standard amortizing loan formula to determine the fixed monthly payment required to fully retire a student loan balance over a chosen repayment term. Borrowers can use this tool to compare plan options, estimate total interest costs, and build a realistic post-graduation budget before selecting a federal or private repayment strategy.

The Monthly Payment Formula

The calculator relies on the following amortization equation:

M = P · [r(1+r)ⁿ] ÷ [(1+r)ⁿ − 1]

Each variable in the formula represents a specific loan parameter:

M — Fixed monthly payment amount (dollars)
P — Principal loan balance (total amount borrowed or currently outstanding)
r — Monthly interest rate, calculated as the annual APR divided by 12
n — Total number of monthly payments, equal to the repayment term in years multiplied by 12

Converting the Annual Rate to a Monthly Rate

Federal and private student loans quote interest as an annual percentage rate (APR). To apply the amortization formula, divide the APR by 12. An annual rate of 6.54% converts to a monthly rate of 0.545%, or 0.00545 in decimal form. Federal Direct Subsidized and Unsubsidized Loan rates for undergraduates reset each July 1 based on the 10-year Treasury note yield plus a statutory add-on, as tracked by Federal Student Aid’s Loan Simulator.

Worked Example: $30,000 Loan at 6.54% Over 10 Years

Consider a borrower with the following loan profile:

Loan balance (P): $30,000
Annual interest rate: 6.54% (2024–2025 undergraduate Direct Loan rate)
Repayment term: 10 years (Federal Standard Repayment Plan)

Step 1 — Convert the annual rate: r = 6.54% ÷ 12 = 0.00545

Step 2 — Calculate total payments: n = 10 × 12 = 120

Step 3 — Apply the formula: M = 30,000 × [0.00545 × (1.00545)¹²⁰] ÷ [(1.00545)¹²⁰ − 1]

Since (1.00545)¹²⁰ ≈ 1.9196, the calculation becomes: M = 30,000 × 0.010462 ÷ 0.9196 ≈ $341.28 per month. Over 120 payments, total outlay equals $40,953.60 — meaning $10,953.60 in total interest accrues above the original $30,000 principal. Extending the same loan to 25 years lowers monthly payments to roughly $202 but more than doubles lifetime interest costs to approximately $30,500.

How Interest Accrues Between Payments

According to Aidvantage’s interest and taxes guidance for federal borrowers, interest on most federal student loans accrues daily. The daily charge equals (Outstanding Principal × Annual Interest Rate) ÷ 365. Each monthly payment first satisfies all accrued interest; the remainder reduces the principal. Early in repayment, a large share of each payment covers interest. As the principal falls, a growing share of each payment attacks the balance directly — the process known as amortization.

As explained in Investopedia’s guide on calculating student loan interest, on a $10,000 loan at 5.05% APR the daily interest charge is approximately $1.38. This daily accrual pattern explains why extra payments made early in the repayment period produce outsized interest savings: every dollar of additional principal reduction immediately lowers tomorrow’s interest charge.

Federal Repayment Plan Options

The repayment term entered into the calculator directly controls both the monthly payment and the total interest paid over the life of the loan:

Standard Repayment (10 years): Fixed payments over 120 months. Produces the lowest total interest cost among non-income-driven plans for most borrowers.
Graduated Repayment (10 years): Payments start lower and increase every two years. Total interest is higher than Standard even with the same 10-year term.
Extended Repayment (up to 25 years): Available to borrowers with more than $30,000 in Direct Loans. Reduces monthly payments but dramatically increases lifetime interest.
Income-Driven Repayment (IDR): Payments set as a percentage of discretionary income. Monthly amounts may fall below the amortization formula result, with balance forgiveness available after 20 to 25 years depending on the specific plan.

This calculator handles fixed-payment Standard and Extended plans directly. For income-driven plan projections linked to actual federal loan data, the Federal Student Aid Loan Simulator provides a side-by-side comparison. Servicer-verified estimates are also available through the MOHELA Loan Repayment Calculator and the Office of Financial Readiness Amortizing Loan Calculator.

Practical Applications

Borrowers use this calculator to:

Compare monthly payment obligations across 10-year, 20-year, and 25-year terms before committing to a repayment plan
Estimate total interest savings from making extra monthly principal payments
Model the impact of refinancing to a lower interest rate on both monthly cost and total repayment amount
Determine how much of take-home pay a fixed loan payment will consume, enabling realistic post-graduation budgeting

Reference

Frequently asked questions

What formula does the student loan repayment calculator use?

The calculator uses the standard amortization formula M = P times r(1+r)^n divided by (1+r)^n minus 1, where P is the principal balance, r is the monthly interest rate (annual APR divided by 12), and n is the total number of monthly payments. For a $30,000 loan at 6.54% APR over 10 years, this formula produces a monthly payment of approximately $341.28 and total interest of $10,953.60 over the life of the loan.

How does extending my repayment term affect total interest paid on my student loans?

Extending the repayment term significantly increases total interest paid even though monthly payments decrease. On a $30,000 loan at 6.54% APR, the 10-year Standard Plan costs approximately $341 per month with about $10,954 in total interest. Stretching the same loan to 25 years cuts the monthly payment to roughly $202 but raises lifetime interest to more than $30,500, meaning the borrower repays nearly twice the original principal over the extended term.

What are the current federal student loan interest rates for undergraduates?

For the 2024-2025 award year, the federal Direct Subsidized and Unsubsidized Loan rate for undergraduates is 6.53% APR. Graduate Unsubsidized Loans carry an 8.08% rate, and Direct PLUS Loans are set at 9.08%. These rates are fixed for the life of any loans disbursed during that award year and reset each July 1 based on the 10-year Treasury note yield plus a statutory add-on, as published annually by Federal Student Aid.

Does making extra monthly payments reduce total student loan interest?

Yes, extra principal payments reduce total interest substantially because student loan interest accrues daily on the outstanding balance. Paying an additional $100 per month on a $30,000 loan at 6.54% can cut the repayment period from 10 years to roughly 7.5 years and save approximately $3,200 in interest. Even one extra payment per year produces meaningful savings over a 10- or 25-year term by shrinking the principal faster and lowering daily interest charges.

What is the difference between Standard Repayment and Extended Repayment for federal student loans?

The Standard Repayment Plan fixes payments over 10 years (120 months) and typically produces the lowest total interest cost among federal non-income-driven plans. The Extended Repayment Plan stretches to 25 years and requires a balance of more than $30,000 in Direct Loans to qualify. While Extended Plan payments can run 30 to 40 percent lower each month, total lifetime interest costs are often two to three times higher, making it a more expensive option over the full repayment horizon.

How do income-driven repayment plans differ from the monthly payment this calculator shows?

Income-driven repayment (IDR) plans such as SAVE, PAYE, and IBR calculate monthly payments as a fixed percentage of the borrower's discretionary income rather than through the standard amortization formula. Payments can be as low as $0 for borrowers with low or no income, and any remaining balance after 20 to 25 years of qualifying payments may be forgiven. However, when IDR payments fall below accruing interest, the loan balance can grow over time, which the fixed-payment amortization formula does not reflect.