How Long Do Student Loans Take To Pay Off?
We’ve all been there. You’re a student, you want to do well in school and get a good job, but then you look at your loan payments and think: “I’ll never be able to pay this off.”
It can seem like the payments will never stop! But don’t worry, we’re here to help. We’ve done the math for you and put together an easy-to-read guide on how long it will take you to pay off your student loans.
How Long Will It Take Me To Pay Off Student Loans
Paying off student loans can take anywhere from 10 to 30 years, depending on the type of loan and repayment term you choose. Even though the Standard Repayment Plan for federal loans lasts 10 years, it takes most borrowers longer to finish paying off their balance.
When will my student loans be paid off?
Students who graduate with federal student loan debt are automatically enrolled in the Standard Repayment Plan, which lasts 10 years. But you can change the repayment plan if you need more flexibility in your budget.
The federal student loan repayment plans include:
- Standard Repayment Plan: Fixed monthly amount for 10 years (or between 10 and 30 years if you have a Direct Consolidation Loan).
- Graduated Repayment Plan: Payments start out low and gradually increase over time, usually every two years, with repayment completed within 10 years (or between 10 and 30 years if you have a Direct Consolidation Loan).
- Extended Repayment Plan: Fixed or graduated payments with a 25-year term.
There are five types of income-driven repayment plans you can apply for, depending on your loan type:
- Revised Pay As You Earn Repayment Plan (REPAYE Plan): Pay 10 percent of your discretionary income for 20 to 25 years for undergraduate or graduate school loans, respectively.
- Pay As You Earn Repayment Plan (PAYE Plan): Pay 10 percent of your discretionary income for 20 years.
- Income-Based Repayment Plan (IBR Plan): Pay 10 percent of your discretionary income for 20 years if you’re a new borrower (on or after July 1, 2014) or 15 percent of your discretionary income for 25 years if you’re not a new borrower.
- Income-Contingent Repayment Plan (ICR Plan): Pay 20 percent of your discretionary income for 25 years or what you would pay on a 12-year repayment plan adjusted to your income.
- Income-Sensitive Repayment Plan (ISR Plan): Make payments on FFEL Loans based on your income over a period of 10 years.
Private student loan lenders have their own repayment options. In general, you can expect to repay your private student loans within five to 20 years unless you choose to refinance.
When do you start paying back student loans?
Borrowers with federal student loans are required to make their first payment six months after they graduate, leave school or drop below half-time enrollment. If they can’t afford to make payments, they can apply for a deferment or forbearance or switch to a different repayment plan.
Most private lenders also provide a six-month grace period for borrowers, and some may extend this to nine or 12 months. Contact the lender to find out when your first payment is due. Many private lenders also offer a forbearance program.
Factors that could impact your student loan repayment
While a general goal is paying off your student loans within 10 years, there are several scenarios that could lengthen or shorten your student loan repayment.
Enrolling in deferment or forbearance
Both deferments and forbearances let you pause student loan payments when you’re unemployed, having health problems, serving in the U.S. Armed Forces or struggling financially. But enrolling in one of these programs will delay the final due date. It may also add the unpaid interest to your student loan balance, which will increase the total interest paid over the life of the loan.
Refinancing student loans
Refinancing is when you take out an entirely new loan to replace your current loans. You’ll have new loan terms, a new interest rate and often a new lender.
Because you get new terms when you refinance, refinancing could change the amount of time it takes to pay off your loans. You can select shorter terms if you can handle the larger monthly payments, or you can extend your repayment timeline to lower your monthly bill. Picking a longer term may also increase the total interest paid over the life of the loan.
Adjusting your payment schedule
You’re not beholden to making only one payment a month. If you make payments every three weeks or even biweekly, you’ll shorten the amount of time you spend paying your loans. On the other hand, missing payments or not paying in full could lengthen your loan term — while also putting you at risk of late fees and negative marks on your credit score.
How to pay back student loans faster
Depending on how much you owe, you could need decades to pay off your student loans — but there are some steps you can take to pay them off sooner.
1. Pay more than the minimum amount
If you have the means, pay more than what you owe each month. The more money you put toward your principal balance, the less you’ll pay in total interest over the life of the loan — and the faster you’ll pay off your loans. If you do choose to make more than the minimum payment, let your lender know that the money is an extra payment. Otherwise, that money might be applied toward your next payment instead.
You should also indicate which exact loan should get the extra payment, so you can target the loans with the highest interest rate or lowest loan balance, depending on your goals.
2. Pay more than once per month
Making an extra payment in addition to the minimum can go a long way toward reducing the principal of your student loan, since you’ll accrue less interest between payments.
If possible, try setting up payments for every two, three or four weeks instead of monthly. Even small tweaks to your schedule can add up.
3. Create and maintain your budget
Your budget is a spending plan for your finances. It should stand as a guideline for how you handle the money that comes in and the money that goes out. The student loan line item should say what you’ll pay every month. If your budget says that you’ll pay $300 when your minimum is $250, then you’ll pay a little extra with every payment.
If you come into a windfall or get a raise at work, consider adding that new money to your student loan payments.
4. Refinance to a shorter term
When you refinance your student loans, you can shorten the repayment term. For example, if you currently have a 10-year term, you can refinance to a seven or five-year term. If you have a good credit score, you might even be able to get a lower interest rate, saving you hundreds or even thousands in total interest.
Keep in mind that refinancing does have its drawbacks. Federal loans will be converted to private loans when you refinance, meaning you’ll no longer be able to sign up for income-driven repayment plans or loan forgiveness programs.
student loan forgiveness
If you are employed by a U.S. federal, state, local, or tribal government or not-for-profit organization, you might be eligible for the Public Service Loan Forgiveness Program. Keep reading to see whether you might qualify.
To ensure you’re on the right track, you should submit a Public Service Loan Forgiveness (PSLF) & Temporary Expanded PSLF (TEPSLF) Certification & Application (PSLF Form) annually or when you change employers. We’ll use the information you provide on the form to let you know if you are making qualifying PSLF payments. This will help you determine if you’re on the right track as early as possible.
*This provision will be waived through October 31, 2022 as part of the limited PSLF waiver. Learn more.
Suspended Payments Count Toward PSLF and TEPSLF During the COVID-19 Administrative Forbearance
If you have a Direct Loan and work full-time for a qualifying employer during the payment suspension (administrative forbearance), then you will receive credit toward PSLF or TEPSLF for the period of suspension as though you made on-time monthly payments in the correct amount while on a qualifying repayment plan.
To see these qualifying payments reflected in your account, you must submit a PSLF form certifying your employment for the same period of time as the suspension. Your count of qualifying payments toward PSLF is officially updated only when you update your employment certifications.
Digital signatures from you or your employer must be hand-drawn (from a signature pad, mouse, finger, or by taking a picture of a signature drawn on a piece of paper that you then scan and embed on the signature line of the PSLF form) to be accepted. Typed signatures, even if made to mimic a hand-drawn signature, or security certificate-based signatures are not accepted.
Note: In-grace, in-school, and certain deferment, forbearance, and bankruptcy statuses are not eligible for credit toward PSLF.
Have questions? Find out what loans qualify and get additional information about student loan flexibilities due to the COVID-19 emergency.
Qualifying employment for the PSLF Program isn’t about the specific job that you do for your employer. Instead, it’s about who your employer is. Employment with the following types of organizations qualifies for PSLF:
- Government organizations at any level (U.S. federal, state, local, or tribal) – this includes the U.S. military
- Not-for-profit organizations that are tax-exempt under Section 501(c)(3) of the Internal Revenue Code
Serving as a full-time AmeriCorps or Peace Corps volunteer also counts as qualifying employment for the PSLF Program.
The following types of employers don’t qualify for PSLF:
- Labor unions
- Partisan political organizations
- For-profit organizations, including for-profit government contractors
Contractors: You must be directly employed by a qualifying employer for your employment to count toward PSLF. If you’re employed by an organization that is doing work under a contract with a qualifying employer, it is your employer’s status—not the status of the organization that your employer has a contract with—that determines whether your employment qualifies for PSLF. For example, if you’re employed by a for-profit contractor that is doing work for a qualifying employer, your employment does not count toward PSLF.
Other types of not-for-profit organizations: If you work for a not-for-profit organization that is not tax-exempt under Section 501(c)(3) of the Internal Revenue Code, it can still be considered a qualifying employer if it provides certain types of qualifying public services.
For PSLF, you’re generally considered to work full-time if you meet your employer’s definition of full-time or work at least 30 hours per week, whichever is greater.
If you are employed in more than one qualifying part-time job at the same time, you will be considered full-time if you work a combined average of at least 30 hours per week with your employers.
If you are employed by a not-for-profit organization, time spent on religious instruction, worship services, or any form of proselytizing as a part of your job responsibilities may be counted toward meeting the full-time employment requirement.
Any loan received under the William D. Ford Federal Direct Loan (Direct Loan) Program qualifies for PSLF.
Loans from these federal student loan programs don’t qualify for PSLF: the Federal Family Education Loan (FFEL) Program and the Federal Perkins Loan (Perkins Loan) Program. However, they may become eligible if you consolidate them into a Direct Consolidation Loan.
Student loans from private lenders do not qualify for PSLF.
Under normal PSLF Program rules, if you consolidate your loans, only qualifying payments that you make on the new Direct Consolidation Loan can be counted toward the 120 payments required for PSLF. Any payments you made on the loans before you consolidated them don’t count. However, if you consolidate these loans into a Direct Loan before October 31, 2022, you may be able to receive qualifying credit for payments made on those loans through the limited PSLF waiver.