How Long to Pay Off Student Loans – The Basics

Looking for an answer to the question: How long to pay off student loans?

Good news! You’ve come to the right place.

Before jumping into the details, understand that everyone’s student debt situation is a little different. Some of you may have private loans with different terms while others may have stuck strictly to the federal loans that were available. It’s important to understand the situation you are in so that you can realistically understand how long it might take to pay off student loans.

how long to pay off student loans

How Long to Pay Off Student Loans: Federal Aid

Upon dropping below full-time student status (which includes graduating from college), your loans will enter what’s called a grace period. During this time, you won’t have to make any payments on your student loans for six months. It’s a great way for you to find a job and get yourself established before the bills start rolling in.

Once you’re out of your grace period, it’s time to start getting your debt paid off. The federal government has a few different repayment options:

  • Standard – Students who choose this option will pay the same amount of money every month until the loan amount (and any additional interest) has been paid in full. How long to pay off student loans under this plan? 10 yearsRemember, you can always pay above the minimum payment amount so that your loans get taken care of sooner.
  • Graduated – Another option allows students to start with lower payments at the beginning of repayment and then pay more as the years go on. Anyone who chooses this option can expect to get an increase in their minimum payment due every two years. Again, you are looking at a total of 10 years to pay the loans off under this plan.
  • Extended Repayment – If you have over $30,000 in Direct Loans, then you may qualify for this repayment plan. Keep in mind that if you extend your payments, you will have to pay a lot more interest over the years. How long to pay off student loans under extended repayment? 25 yearsAgain, if you get the means to pay the loans off earlier, you should do so.

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  • Income-Based Repayment (IBR) – This is where you are going to show evidence of a financial hardship. You’ll most likely need to provide paperwork or proof of any income to be eligible. If approved, expect your payments to be approximately 15 percent of your discretionary income. Under this repayment plan, students have 25 years to make payments. If any debt is leftover after that time, the student is forgiven that remaining amount.
  • Pay as You Earn – Similar to the IRB plan, this one requires evidence of financial hardship, but monthly payments will only be 10 percent of the discretionary income. Another difference is that borrowers can expect to pay for 20 years instead of 25. After 20 years of payments, any remaining debt will be forgiven.
  • Income-Contingent – A few different factors come into play here: the size of your household, how much money you are bringing in annually, and whether you get any raises or lose hours. It’s somewhat of a complex calculation that requires approval before it’s implemented. For those that do enroll in this plan, 25 years is the expected payoff term.
  • Income-Sensitive – This one does not have a straightforward formula like some of the other options mentioned above. In this case, you will need to talk with the lender of your loan(s) to see how they calculate the monthly payment amount you could be facing. How long to pay off student loans with this plan? 10 years.

Important Note: The amount of money you borrowed affects your payoff time if you consolidated your loans! For more information on that, check out the Federal Student Aid website.

I know that’s a lot of information to take in, but it’s important to know all of your options. Keep in mind that you have the ability to change your repayment plan or apply for a deferment of forbearance of a life event happens that affects your income or ability to pay your bills on time. It’s always better to communicate any of these hardships with your lenders before the past-due date arrives because your loans could eventually default, and that is something you definitely don’t want to deal with.

What About Private Student Loans?

This is where the water gets a little murky. Depending on who you got the loan from and what their agreement was, you could find yourself paying for any length of time, though hopefully not more than 25 years.

You’ll want to ask your lender whether they have any fees for paying the loan off early. It sounds crazy, but it does happen.

One of the best bits of advice I can offer you is to keep copies of all your paperwork so that you can reference it whenever you have questions. If you can’t find the answer, call your lender and have them explain their policies. It’s good to keep the lines of communication open in case a hardship comes in the future.

Tip: Keep Your Finances Organized

how long to pay off student loans

Now that you know how long it might take to pay off student loans, it’s time to get your finances in check. I highly recommend using a budget sheet of some sort so that you know where all your payments are going and when they’re due. You can check out the Study Sesh on Etsy for some instant download budgeting sheets that will help you keep everything in order.

If you’re still a college student and you want to get a good start on your finances, here’s a free budgeting printable set just for you!

I know those loans seem daunting and that 10+ years seems like forever, so if you have the ability to utilize a debt snowball tool or other money saving method, do so! It could save you a lot of money in interest down the road!

What financial advice would you offer to anyone who is paying down debt, whether it be educational or some other type?

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  • Earl-Leigh
    June 11, 2015 at 12:39 pm

    Write out everything owe and make a plan of action to pay them off. Stay on top of your payments and don’t use more credit than you need. Another great post!

    • Tori
      June 11, 2015 at 1:24 pm

      Great ideas! I think staying on top of your payments is crucial and not using more than you need. Thanks for sharing!

  • Suzette
    June 11, 2015 at 1:20 pm

    Great information and timely! We saved up to pay for both our kids’ college tuitions so they don’t have any loans or debt as they graduate from college. One is done, and the other is a rising junior. So far so good!

    • Tori
      June 11, 2015 at 1:24 pm

      That’s great! I wish that I had the means to pay for college back when I went, but at least I’m able to use my experiences to hopefully help others now. It’s crazy how out of control student debt is right now.

    June 11, 2015 at 2:27 pm

    This is some great information! My husband and I are both college students and we both have student loan debt. Not a lot, but some. I would say for sure to always budget more for loan payments. Pay as much as you can afford each month. Don’t do just the bare minimum. Please check out my blog post, fun summer metaphor about your budget!

  • Kate
    June 11, 2015 at 3:15 pm

    This is a great way to explain all of the options with paying back student loans. Thanks so much for this post!

  • Robin Follette
    June 11, 2015 at 4:37 pm

    This is very helpful. My daughter graduated last month. We’re still figuring out the best way to manage loans, and having it all here in one place and explained clearly is a big help. Thank you!

    • Tori
      June 11, 2015 at 4:56 pm

      So glad it was helpful, Robin!

  • Kayla
    June 11, 2015 at 10:39 pm

    I’m slowly working on paying more on my loans each month than the minimum. It’s just so hard motivating myself to do it when I know it will still be forever before they’re paid off, and I could use that extra $100 for a new pair of shoes instead 🙂