What is the US Student Loan?
Federal student loans carry fixed rates set annually by Congress and offer income-driven repayment, deferment and forgiveness programmes. Private loans are priced on credit and offer far fewer protections.
The standard federal repayment term is 10 years. Extending it lowers the payment but substantially increases total interest.
Formula & worked example
Worked example: $38,000 at 6.5% over 10 years → a monthly payment of about $431 and total interest of roughly $13,800. Stretching to 20 years drops the payment to $283 but nearly doubles the interest to about $29,900.
How to use this us student loan calculator
- Enter your total balance across all loans, or run each separately if rates differ.
- Use the weighted average rate if combining loans.
- The standard term is 10 years; extended plans go to 25.
- Add an extra payment to see the interest saved.
Smart tips
- Target the highest-rate loan first with extra payments — that is the avalanche method and saves the most.
- Federal loans offer income-driven repayment capped at 5–10% of discretionary income, with forgiveness after 20–25 years.
- Public Service Loan Forgiveness can wipe the remaining balance after 120 qualifying payments in eligible employment.
- Refinancing federal loans into private ones permanently forfeits income-driven repayment and forgiveness — rarely worth it.
- Student loan interest of up to $2,500 a year is deductible, even without itemising.
Frequently asked questions
How long does it take to pay off student loans?
The standard federal plan is 10 years. Income-driven plans run 20–25 years with forgiveness of any remaining balance.
Should I refinance my student loans?
Only private loans, or federal loans if you are certain you will never need income-driven repayment or forgiveness. Refinancing federal loans is irreversible.
What is income-driven repayment?
Federal plans that cap payments at 5–10% of discretionary income and forgive the balance after 20–25 years of qualifying payments.
Is student loan interest tax deductible?
Yes, up to $2,500 a year as an above-the-line deduction, subject to income phase-outs.
Want the theory behind the numbers? Read our student loan guides on the Money Blog.