How long does it take to pay off student loans?

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Nobody wants to hold onto student loan debt longer than they have to, so if you're a current or potential borrower, you're likely wondering how long does it take to pay off student loans? If a borrower can pay off their student debt sooner, the better. However, the repayment timeline can be either longer or shorter for everyone.

Scholarships are a great alternative to student loans. Bold.org even has scholarships that can be put directly towards student loan repayment. Simply create your profile to explore these exclusive opportunities for financial aid.

According to the U.S. Department of Education, 10 years is the ideal timeline to pay off your student loan, but repayment terms can last anywhere from 10 to 30 years. There are still many factors involved in determining how long it will take to pay off your student loans.

The type of student loan repayment plan, interest rate, and loan amount all have an effect on how long it takes to pay off loans. Fortunately, there are ways to reach being debt free early, like choosing to make extra payments or making larger monthly payments. At any time, you can even pay off your loans in full.

How long does it take to pay off student loans?

Understanding your repayment options can help you find the best way to pay off student loans faster. Every repayment plan has its own benefits, as well as its own repayment terms. Federal student loan borrowers can expect the length of their loan term based on their specific plan:

  • Standard Repayment Plan. 10 years (within 10 to 30 years for Consolidation Loans)
  • Graduated Repayment Plan. 10 years (within 10 to 30 years for Consolidation Loans)
  • Extended Repayment Plan. Ensures you fully pay off loans within 25 years of fixed or graduated payments.
  • Income-Driven Repayment Plans. Depends on the borrower's discretionary income.

When you pay more than what is expected for minimum payments, you are on track towards paying off your student loans faster than the expected repayment terms.

Are student loans forgiven after 20 years?

The truth is that repayment takes a really, really long time. The average time for student borrowers to fully repay their loans is closer to 20 years, but repayment periods can last well beyond that. Luckily, student loan forgiveness programs will forgive student loan debt after the length of the loan term.

This applies mostly to federal student loans. Typically, federal student loans have more options for income-driven repayment plans than offered by private student loans.

With an income-driven repayment plan, borrowers can have any outstanding balance of their federal student loan debt forgiven if their loans are not fully paid off at the end of the repayment periods.

  • Pay As You Earn Repayment Plan (PAYE). 20 years of repayment.
  • Revised Pay As You Earn Repayment Plan (REPAYE). 20 years of repayment (within 25 years for any loans taken out by graduate students).
  • Income-Based Repayment Plan (IBR). 20 years of repayment if you’re a new borrower on or after July 1, 2014. 25 years if you’re not a new borrower on or after July 1, 2014.
  • Income-Contingent Repayment Plan (ICR). 25 years of repayment.
Are student loans forgiven after 20 years?

Be aware that under any income-driven repayment plan, you'll be paying more total interest over time compared to the Standard Repayment Plan. You may even have to pay income tax on any amount that is forgiven.

If you're working towards loan forgiveness under the Public Service Loan Forgiveness Program (PSLF), you may qualify within 10 years of repayment rather than the full 20 or 25 years under income-driven repayment plans. The Teacher Loan Forgiveness Program also offers forgiveness on up to 100% of student debt after only five years of teaching at an eligible school.

For private student loans, your options will vary according to the private lenders. Be sure to speak with your private lender to see about eligibility for repayment assistance programs or how to get your private loans forgiven.

Is it better to have savings or pay off student loans?

Over the course of your repayment term, you'll probably wonder whether the amount of your monthly payment would do better being invested or put into savings. You may find that student loan payments are holding you back from reaching your financial goals in life.

Among all existing borrowers, 5.8% is the average student loan interest rate. If your loans have an interest rate lower than this average, putting the extra money into savings or other high-interest expenses would be best.

Paying off high interest student loan debt should take priority. In contrast, loans with lower interest rates don't have to be your top priority, especially if you have any other outstanding debt with a high interest rate.

If you have high interest private loans, it is best to pay off the student debt. You'll find you can save money under student loan repayment plans by paying ahead of schedule on monthly payments or even making extra payments.

Since federal loans tend to have lower interest rates, federal student loan borrowers will pay less total interest and can better afford to put payments into savings rather than monthly payments.

What is the average amount of student loan debt?

In the United States alone, student loan debt has seen unforeseen highs, peaking upwards of $1.7 trillion in total.

Federal student loans make up 92.7% of this, accounting for $1.6 trillion in total student debt. The national total debt balance for private student loans exceeds $140 billion.

The average student loan debt is set at $32,880. Most borrowers who are bachelor's degree holders took out a federal student loan balance averaging $32,880 to attain their bachelor’s degree. The average student loan debt for private loans is set at about $37,787.

Frequently asked questions about paying off student loans

Are student loans forgiven after death?

While it can be a heavy subject to imagine, most borrowers aren't sure how death affects student loans. It really comes down to whether you have federal loans or private loans left unpaid upon an untimely death.

Federal student loan borrowers will have their student loan debt discharged after death. Parents who took out PLUS Loans may apply for a death discharge if the student for whom the parent received the loan dies. A "death discharge" can also be applied by a surviving student if both parents who took out PLUS Loans die.

Private student loans are a different story. Private lenders do not administer discharges for private student loan debt and will handle it the same way as other types of debt.

Although a person's student debt does not go away when they die, no one else is required to pay off the debts of someone who died. When someone dies, any unpaid debt is covered by their remaining assets, any money or property they left behind.

It is important to secure adequate life insurance coverage in the event of both financial and life crises during the repayment term.

What if I can never pay off my student loans?

To answer this question, it's important to understand what other repayment options are available to you. You generally want to avoid any delinquent payments, or your loans going into default. But it is not uncommon for many borrowers to find themselves struggling to keep up with monthly payments.

If you find yourself falling behind on payments at any point during the repayment term, contact your loan servicer immediately to look at your repayment options and see how you can still manage to pay off your student loan debt.

Bold.org grants

Life happens and it can be to make consistent student loan payments for years or even decades. That's why Bold.org provides exclusive grants to help both current students and graduates alike pay off student loans. These grants aim to reduce the amount of time you would spend paying back your loans.

Scholarships are a great alternative to student loans. Bold.org even has scholarships that can be put directly towards student loan repayment. Simply create your profile to explore these exclusive opportunities for financial aid.

Forgiveness, cancellation, or discharge

It is always worth looking into how you can get your loans either forgiven, discharged, or canceled. While these terms are essentially similar, they are used in different ways.

If you’re no longer required to make payments on your loans due to your job, this is generally called forgiveness or cancellation. If you’re no longer required to make payments on your loans due to other circumstances, such as a total and permanent disability or the closure of the school where you received your loans, this is generally called discharge.

If you want to learn more, check out this guide on student loan forgiveness.

Change your repayment plan

Consider talking to your student loan servicer about different repayment plans that may be better suited for your financial situation. Some may offer lower interest rates or extended repayment periods.

You can switch to one of many income-driven repayment plans. An income-based repayment plan is based on a borrower's discretionary income. Most federal student loan borrowers with income-driven repayment plans have the opportunity for student loan forgiveness if their debt is not fully repaid after 20 years or more of making monthly payments.

Unfortunately, there aren't as many options when changing your private student loan repayment plan. Although the options are limited, there are still options for when you can barely afford monthly payments, or when you want to get out of debt faster.

Budget your expenses

Student loan payments are just one more expense to worry about every month. It may look like paying off your student loans, in the long run, will be an impossible feat, but budgeting can help make it possible. Having your finances in order will help you best in keeping up with payments.

Monitor your expenses each month and see where adjusting your finances would make a significant difference: Do you spend too much in one area? Could you be saving and reducing how much you spend when you treat yourself out every week? Should this year's tax refund be put towards monthly payments? You may even find some money left over each month to make extra payments.

You may find the results of your budgeting to be a balanced financial life. Some of your other financial goals may have to be put on hold, but you'll be able to pay off student loans faster.

Get a second job

Working another job can give you more funds to put towards student loan repayment. If you're struggling to make your monthly payment, having another source of income can help make up for the missing amount.

This supplementary income could be as simple as asking your current supervisor for overtime opportunities. Alternatively, consider freelancing or finding a side job.

It's important to note that with federal loans, you need to have a high debt relative to your income to be eligible for certain income-driven repayment plans.

Refinancing your student loans

You also have the option of refinancing student loans, which will collect all or multiple federal student loans or private student loans in your credit portfolio into a new, singular loan with a private lender.

This will raise your monthly payment but lower your interest rate, which saves you more money in the long run. You can choose your new loan term to be as short as five to seven years, or as long as 15 years.

Take note that doing so to your federal student loans will turn them into private student loans. Refinancing your federal student loans means you'll be losing many of the federal benefits that come with them, and you'll lose the chances for longer loan deferment, income-driven repayment plans, and student loan forgiveness programs.

You can refinance any of your private loans, even together with your other federal loans. Compare the terms and interest rates between private lenders before taking the next step to finding the best fit for you.

When do I begin making monthly payments for student loans?

Repayment plans with the federal government come with federal benefits. Upon graduating or your student status falling under half-time enrollment, undergraduate borrowers with federal loans have a six-month grace period before the official start of their monthly payments.

While private lenders are not required to, some may still offer a six-month grace period on your private loans. Make sure to check with your loan servicer so that you're aware of when your monthly payments are scheduled to begin once the grace period is over.

When you pay more than what is expected for minimum payments, you are on track towards paying off your student loans faster. At any time, you can even pay off your loans in full or make an extra payment on top of your monthly payment.

To help minimize your need for student loans, start applying for scholarships on Bold.org today!

Budget your expenses

Student loan payments are just one more expense to worry about every month. It may look like paying off your student loans in the long run will be an impossible feat, but budgeting can help make it possible. Having your finances in order will help you best in keeping up with payments.

Monitor your expenses each month and see where adjusting your finances would make a significant difference: Do you spend too much in one area? Could you be saving and reducing how much you spend when you treat yourself out every week? Should this year's tax refund be put towards monthly payments? You may even find some money leftover each month to make extra payments.

You may find the results of your budgeting to be a balanced financial life. Some of your other financial goals may have to be put on hold, but you'll be able to pay off student loans faster.

Get a second job

Working another job can give you more funds to put towards student loan repayment. If you're struggling to make your monthly payment, having another source of income can help make up for the missing amount.

It could be as simple as asking your current supervisor for overtime opportunities. Consider freelancing or finding a side job.

It's important to note that with federal loans, you need to have a high debt relative to your income to be eligible for certain income driven repayment plans.

Refinancing your student loans

You also have the option of refinancing student loans, which will collect all or multiple federal student loans or private student loans in your credit portfolio into a new, singular loan with a private lender.

This will raise your monthly payment but lower your interest rate, which saves you more money in the long run. You can choose your new loan term to be as short as five to seven years, or as long as 15 years.

Take note that doing so to your federal student loans will turn them into private student loans. Refinancing your federal student loans means you'll be losing many of the federal benefits that come with them, and you'll lose the chances for longer loan deferment, income driven repayment plans, and student loan forgiveness programs.

You can refinance any of your private loans, even together with your other federal loans. Compare the terms and interest rates between private lenders before taking the next step to find the best fit for you.

When do I begin making monthly payments for student loans?

Repayment plans with the federal government come with federal benefits. Upon graduating or your student status falling under half time enrollment, undergraduate borrowers with federal loans have a six month grace period before the official start of their monthly payments.

While private lenders are not required to, some may still offer a six month grace period on your private loans. Make sure to check with your loan servicer so that you're aware of when your monthly payments are scheduled to begin once the grace period is over.

When you pay more than what is expected for minimum payments, you are on track towards paying off your student loans faster. At any time, you can even pay off your loans in full or make an extra payment on top of your monthly payment.

Create your profile now and learn more about paying back student loans by visiting the Bold.org Scholarship Blog.