How to use this calculator
- Enter the Amount borrowed and the Interest rate from your loan agreement or servicer statement.
- Set Months before repayment starts: the months of school plus any grace period during which interest still builds up.
- Choose the Repayment term in years, then try an Extra payment per month to see the effect.
- Read the Monthly payment, the balance when repayment starts, total interest and the payoff time.
How a student loan payment is calculated
Student loans are usually repaid in equal monthly installments, using the same annuity formula as other fixed-rate loans. The twist is the period before repayment starts. If interest accrues during school or a grace period and nobody pays it, it is typically added to the balance (capitalized), so you start repaying more than you borrowed.
B = P · (1 + r)^g M = B · r(1 + r)^n / ((1 + r)^n − 1)- P = amount borrowed
- r = monthly interest rate (annual rate ÷ 12 ÷ 100)
- g = months before repayment starts
- B = balance when repayment begins
- n = number of monthly payments (years × 12)
- M = monthly payment
This calculator grows the loan by the monthly rate for the number of months you enter, then sets the payment so the larger balance is repaid over the term. Your servicer's rules on when interest capitalizes can differ, so treat the result as an estimate.
Example: $30,000 at 6.5% over 10 years
With the default inputs and a 6-month wait before repayment, the $30,000 loan grows by $988 to $30,988 before the first payment. The monthly payment is $351.87, the loan is paid off in 120 months, and total interest is $12,224, including the $988 that built up first.
If interest had not accrued before repayment (0 months), the payment would be $340.64 and total interest $10,877. The six-month wait cost about $1,347 in extra interest over the life of the loan.
Term, rate and extra payments compared
On the same loan, stretching repayment to 20 years lowers the payment to $231.04, but total interest jumps to $25,450. A 4.5% rate instead of 6.5% gives a $317.98 payment and $8,157 total interest.
Adding $100 a month to the default loan raises the payment to $451.87, ends the loan in 86 months instead of 120 and cuts total interest to $8,843. Extra money matters most early, when the balance and the interest charges are highest.
Using the result to decide
A common planning check is whether the payment fits comfortably next to your other debts; the debt-to-income calculator turns that into a ratio. Compare the total interest across terms, not just the payment, and ask whether a lower payment today is worth thousands more in interest.
If you have several loans at different rates, aim extra payments at the highest rate first and see the effect with the loan payoff calculator. For a full month-by-month split of interest and principal, use the amortization calculator.
Ways to lower the cost
- Pay the interest that accrues during school or grace if you can; it stops the balance from growing.
- Pay extra toward principal and tell your servicer to apply it to the loan, not to future installments.
- Choose the shortest term whose payment you can sustain.
- Compare refinancing offers carefully, but note that refinancing federal loans with a private lender usually means losing federal protections and repayment options.
- Keep your servicer's contact details current so you never miss a due date.
Assumptions and limits
This tool models one loan with a single fixed rate and equal monthly payments. It does not model income-driven repayment, graduated or extended plans, forgiveness, deferment or forbearance, origination fees, interest rate discounts for autopay, or tax deductions for interest.
Different loans in a package may have different rates and rules. Use your servicer's statement for exact figures, and talk to your school's financial aid office or a nonprofit counselor before changing your repayment plan.
Frequently asked questions
Does interest build up while I'm still in school?
On unsubsidized and most private loans, yes. Enter the months before repayment starts and the calculator adds that interest to the balance. Subsidized federal loans work differently, so check your loan type.
How much should I pay toward my student loan each month?
At least the required payment, and more if your budget allows after you have an emergency cushion. Even a modest extra amount shortens the loan and reduces interest.
Is it better to pick a 10-year or 20-year term?
A 10-year term costs far less interest but has a higher payment. Pick the shortest term you can pay without strain, and prepay later when you can.
What is capitalized interest?
It is unpaid interest that is added to your principal, so future interest is charged on a larger balance. That is why starting repayment with a higher balance raises the total cost.
Can I use this for federal and private loans?
Yes for a fixed-rate loan with standard payments. It cannot show income-driven plans or forgiveness, so use your servicer's tools for those.