Average Cost Of Student Loans Per Month

Last Updated on January 15, 2023

The average cost of student loans per month varies greatly depending on the type of loan, whether or not you have any other debt, and how much money you make.

If you’re looking for a specific amount, here are some averages:

The average cost of student loans per month for undergraduates is $350.

The average cost of student loans per month for graduate students is $1,000.

Average Cost Of Student Loans Per Month

The typical monthly student loan payment among borrowers who were actively repaying their loans in 2019 was between $200 and $299, according to the Federal Reserve. But your monthly bill may be much lower or higher than that. Your required payment depends on the amount you initially borrowed, your interest rate and the repayment plan you’ve chosen.

It’s possible to change your payment amount if you want to save money or pay off your loans faster, and there are many ways to estimate how much you’ll pay when you first borrow. Here’s what you need to know.

What Is the Average Student Loan Payment?

Federal student loan payments have been paused since March 2020 due to the pandemic, so many borrowers are enjoying a reprieve from monthly payments. However, that pause is set to expire later this year. To get an idea of what the average student loan payment will be, we can look at pre-pandemic data.

Each year, the Federal Reserve releases its “Report on the Economic Well-Being of U.S. Households,” a survey of thousands of adults and their current economic security. According to the 2019 survey, student loan borrowers who were repaying loans made a “typical” monthly loan payment of $200 to $299.

The 2016 survey, released in 2017, gave a more specific data point: It found the average monthly student loan bill among those who were actively making payments was $393, and the median monthly payment was $222.

How Your Payment Plan Affects What You Owe

Let’s take a look at how your monthly payment can change depending on the type of repayment plan you choose.

In this example, a borrower graduated from a four-year private nonprofit college in Florida with $60,000 in unsubsidized federal student loans. They got a job in marketing with a $45,000 annual salary. Their average student loan interest rate is 4.2%.

(Note that $60,000 is more than the average student loan balance among graduates. But it will allow us to see how income-driven repayment (IDR) plans can make payments more affordable for high-balance borrowers.)

The examples above apply specifically to federal student loans, which provide a range of repayment options that can help you more easily afford your monthly bill. If you have private loans, your lender will offer different repayment plans—but the general patterns should be the same. The longer you’re in repayment, the lower your monthly payment will be. However, you will pay more in interest charges over the life of your loan if you stretch out repayment.

How to Estimate Your Monthly Student Loan Costs

The best way to estimate your monthly loan payment is to use a student loan calculator. You’ll enter the total loan amount; interest rate (or an average of all your rates if you have multiple loans); the length of time you’ll be paying; and any extra amount you can contribute each month beyond the minimum. That will give you a general idea of your monthly and total payment over time.

You can get a more specific view of your federal loans using Federal Student Aid’s Loan Simulator. By logging in with your Federal Student Aid ID (FSA ID), which you likely created when filing the Free Application for Federal Student Aid (FAFSA), you can view your own real-time federal loan information and explore different repayment options.

What If You Can’t Afford Your Monthly Payments?

There are several ways to lower monthly student loan payments if you need to. Here are some options.

1. Switch Repayment Plans

If you have federal student loans, you’ll be placed on the standard plan when you leave school unless you choose a different one. (You can switch to a new repayment plan anytime with the help of your student loan servicer.) The standard repayment plan splits your balance into 120 equal payments, which means you’ll be debt-free in 10 years.

But for many borrowers, that can make payments expensive. As a result, the government offers other options, including the graduated plan. With that option, payments increase slowly over time under the assumption that your income will also increase as you progress in your career.

Income-driven repayment plans including income-based repayment (IBR), income-contingent repayment (ICR), Pay As You Earn (PAYE) and Revised Pay As You Earn (REPAYE) tie your monthly student loan payments directly to your income, limiting loan costs to 10% to 20% of what you earn.

2. Consolidate Federal Loans

When you consolidate federal loans, the government combines all of your existing loans into one new loan. This can make repayment easier to manage, but it has the added benefit of extending your repayment term—thus lowering your monthly payment.

You’ll pay more in interest over the life of your loan, but you’ll have up to 30 years to pay off your debt. Consolidation is permanent and irreversible, and depending on your circumstances, you may lose access to certain borrower benefits. Make sure you understand all the pros and cons of this method before committing to it.

3. Consider Deferment or Forbearance

If you’re experiencing difficulties affording loans in the short term—while recovering from an injury, for example, or during a few months’ break in employment—you can apply for deferment or forbearance through your loan servicer. You won’t be required to make payments during this time. The main difference between the two is in the fact that subsidized federal loans do not accrue interest during periods of deferment, while all loans accrue interest in forbearance.

Private loans generally refer to a pause in payments as forbearance, rather than deferment, and in nearly all cases, interest will accrue.

4. Look Into Refinancing

Similar to consolidation, student loan refinancing turns multiple loans into a single one, but with a different goal: to lower interest rates. When you refinance, a lender evaluates your credit score, income and other financial information, and ideally, you’ll qualify for a lower rate than you originally received on the loans.

You can refinance federal loans, private loans or both types together, but if you refinance federal loans, you’ll lose access to benefits including income-driven repayment and forgiveness programs.

Refinancing to a lower interest rate usually means you’ll pay less over time, but it may not lead to a substantially lower monthly payment. In fact, if you want to take advantage of your interest savings, consider paying off your loans as fast as possible—maybe even increasing your monthly payment to do so.

5. Find Repayment Assistance

Besides lowering your payments, there are other ways to get help paying off your loans. Some companies offer repayment assistance to employees. Grant programs like the National Health Service Corps Loan Repayment Program help graduates who work in certain in-demand jobs pay off education debt.

Many states and schools also provide student loan repayment based on your employment and income level. For example, lawyers working in public-sector jobs may qualify for loan repayment assistance programs (LRAPs) from their law schools.

Average Cost Of Student Loans Per Month