Student Loan Calculator
Using a student loan calculator can help you create a student loan repayment strategy that's right for you. With some basic information about your existing or prospective student loans, this calculator will show your estimated monthly payment based on the length of your repayment term. Additionally, it will show you how much interest you'll pay overall.
Modify the values and click the Calculate button to use
What is a Student Loan Calculator?
A student loan calculator is a financial tool that helps you estimate monthly payments, total interest costs, and the payoff timeline for student loans. It takes into account factors such as loan amount, interest rate, loan term, and grace period to provide a comprehensive view of your repayment obligations.
Student Loan Payment Formula
The monthly payment for a student loan is typically calculated using the standard amortization formula:
$$PMT = \frac{P \times r \times (1+r)^n}{(1+r)^n-1}$$
Where:
- P = Principal loan amount
- r = Monthly interest rate (annual rate divided by 12)
- n = Total number of monthly payments (loan term in years × 12)
Understanding Grace Periods
Many student loans offer a grace period after graduation before repayment begins. During this period, you may not be required to make payments, but interest typically continues to accrue. The calculator shows how a grace period impacts your total repayment amount and compares scenarios with and without interest payments during this time.
How to Use This Calculator
1. Enter your total student loan amount.
2. Input the annual interest rate for your loans.
3. Specify the loan term in years.
4. If applicable, enter the grace period in months.
5. Indicate whether you plan to pay interest during school years.
6. Click the Calculate button to see your results.
7. View the detailed amortization table to understand how each payment is applied over time.
Important Notes
- • This calculator assumes a fixed interest rate throughout the loan term.
- • Federal student loans may have different repayment options not covered by this basic calculator.
- • The grace period option shows how capitalizing interest affects your total repayment amount.
- • Actual loan terms may vary based on your lender and loan type.
Student Loan Repayment Tips
1. Make Extra Payments: Even small additional payments can significantly reduce your total interest paid and shorten the loan term.
2. Pay Interest During School: If possible, paying interest while in school prevents it from capitalizing (being added to your principal) when repayment begins.
3. Explore Refinancing: If you have good credit and income, refinancing to a lower interest rate could save thousands over the life of the loan.
4. Look Into Forgiveness Programs: Teachers, public servants, and certain healthcare professionals may qualify for loan forgiveness programs.
Frequently Asked Questions
Should I pay off student loans early?
Paying off student loans early can save you money on interest and free up your monthly cash flow. However, it depends on your other financial priorities like emergency savings, retirement contributions, or higher-interest debt.
How does a grace period affect my student loan?
A grace period delays your first payment, but interest usually continues to accrue. If unpaid, this interest may capitalize (add to your principal), increasing the total cost of your loan.
What's the difference between subsidized and unsubsidized student loans?
The government pays the interest on subsidized loans while you're in school and during grace periods. For unsubsidized loans, interest accumulates from the time the loan is disbursed, even during school and grace periods.
Can I refinance my student loans?
Yes, many private lenders offer student loan refinancing. However, refinancing federal loans with a private lender means losing federal benefits like income-driven repayment plans and potential loan forgiveness.