How to use the student loan calculator
The calculator has two tools: one for repaying a balance, one for the years before repayment starts.
Repayment opens with a $32,000 balance at 6.5% on the standard 10-year plan.
- Loan balance: what you owe when repayment begins, including any interest added to the principal. Your servicer’s statement shows it.
- Interest rate. With several loans at different rates, use the weighted average (the chart and totals will be close), or run each loan separately for exact figures.
- Repayment plan. Standard spreads the balance over 10 years, extended over 25 years, and the third option lets you type your own monthly payment, for example to see what paying extra does.
The chart shows the balance falling and the interest adding up, with the standard plan dashed for comparison when you choose another option.
Interest while in school shows how much interest builds up before the first payment:
- Amount borrowed each year, with the rate for that year’s loan. Federal rates are set each year, so later loans often carry different rates.
- Months in school and the grace period. Four academic years run about 45 months from the first loan to graduation; federal loans usually give a six-month grace period after that.
- Whether the interest is capitalized or paid as it accrues.
How the payment and the interest are calculated
A fixed-rate student loan is repaid like any installment loan:
With your own payment, the calculator runs the balance forward month by month until it reaches zero. If the payment does not cover the first month’s interest, the loan would never be repaid, and the calculator asks for a higher amount.
Before repayment, federal student loans accrue simple interest, and each year’s loan accrues it from the day it is paid out:
A worked example
Repayment. You owe $32,000 at 6.5%. On the standard 10-year plan the payment is $363.35 a month, and you repay $43,602.42 in total, of which $11,602.42 is interest. In the first month, $173.33 of the payment goes to interest.
In school. You borrow $27,000.00 in unsubsidized loans over four years, at rates of 6% to 6.5%. By the time repayment starts 51 months after the first loan, $4,467.50 of interest has built up. If it is capitalized, your starting balance is $31,467.50 and the 10-year payment is $353.12. Paying the interest as it accrues, about $140.00 a month once all four loans are out, keeps the payment at $302.79 and saves $1,572.04 over the life of the loans.
Standard, extended or paying more
| Option | Monthly payment | Time to repay | Total interest |
|---|---|---|---|
| Extended, 25 years | $216.07 | 300 months | $32,819.89 |
| Standard, 10 years | $363.35 | 120 months | $11,602.42 |
| $450 a month | $450.00 | 91 months | $8,520.86 |
| $600 a month | $600.00 | 64 months | $5,866.52 |
The extended plan cuts the payment by about 40% but nearly triples the interest, because the balance stays high for much longer. Paying more than the standard amount works the other way: every extra dollar goes to principal and stops accruing interest for the rest of the loan. Federal student loans and most private ones have no prepayment penalty. Ask the servicer to apply extra payments to the highest-rate loan.
The rate matters as much as the plan. On the same balance over 10 years, a 4.5% rate means $331.64 a month and $7,797.15 of interest; at 8.5% it is $396.75 and $15,610.50.
Interest during school, the grace period and capitalization
Interest on unsubsidized loans starts the day the money reaches your school, and the first year’s loan accrues for the longest. In the example the year-one loan accrues interest for 51 months before the first payment, which is why it builds up the most interest even though later loans are larger. The table under the tool shows each loan’s share.
Two rules decide how much this costs:
- Subsidized or unsubsidized. Subsidized federal loans, available to undergraduates with financial need, charge no interest while you are in school at least half-time or in the grace period. Leave them out of the in-school tool, or enter them at 0%.
- Capitalization. Since July 2023, federal Direct loans no longer add unpaid interest to the principal when the grace period ends. The interest is still owed, and payments go to it first, but it does not itself earn interest. Capitalization does still apply to federal loans in some situations, such as the end of a deferment on an unsubsidized loan, and many private lenders capitalize when repayment begins. The calculator’s capitalized setting shows that case; the paid setting shows the cost of keeping the balance flat by paying the interest while in school.
Even small payments during school help: covering the interest on the example loans costs $140.00 a month at most.
What this calculator does not include
- Income-driven repayment. Payments based on income, and any forgiveness at the end, depend on rules that have changed several times and on your income and family size. Use the official tools on studentaid.gov for those plans.
- Forgiveness programs such as Public Service Loan Forgiveness, and forbearance or deferment periods.
- Variable rates on some private loans, which can rise during repayment.
- Fees and tax effects. Federal loans carry an origination fee deducted from each disbursement, and in the US some student loan interest may be tax-deductible, subject to income limits.
Your servicer’s statements are the authoritative figures. Use this calculator to compare plans, test extra payments and see what interest before repayment costs.