Student Loans

What will my monthly payment be?

A fixed payment over a fixed term, with the interest it costs over the whole loan, and what putting anything extra against the principal does to both.

Anything above the scheduled payment.
US federal loans accrue simple interest daily; most others compound monthly.
Scheduled monthly payment$340.95
  • $10,913.92Interest over the loan
  • $40,913.92Total repaid
  • 10 yearsTime to clear

How the payment is worked out

A level payment that clears the balance over the term, with interest charged on whatever is still outstanding each month. Early payments are mostly interest and late ones are mostly principal, which is why paying anything extra early is worth more than paying the same amount later.

The two accrual conventions

US federal loans accrue simple interest daily and never compound it. Private loans and most Canadian provincial loans compound monthly. Over an average month the two produce the same figure, so the scheduled payment is the same either way. Where they part company is what happens when a payment does not cover the interest: on a federal loan the shortfall waits outside the principal, and on a compounding loan it joins it.

What it does not know

Origination fees, late fees, and any rate reduction for paying by automatic debit. US federal borrowers get one percent off for automatic debit at the moment, which is a temporary increase from a quarter of a percent and runs to June 2028.

Sources

  1. Interest Rates for Federal Direct Loans First Disbursed Between July 1, 2026 and June 30, 2027 (GENERAL-26-33), U.S. Department of Education, Federal Student Aid. Checked on . Backs the 6.52%, 8.07% and 9.07% rates for 2026-27; the statutory add-ons and caps; the 12 May 2026 Treasury auction high yield of 4.468%.
  2. Interest rates and fees for federal student loans, U.S. Department of Education. Checked on . Backs the 1.057% and 4.228% origination fees; that the published fees run only to 30 September 2027; the 5% rate on outstanding Perkins loans.
  3. Repayment plans and important definitions, U.S. Department of Education. Checked on . Backs the annual and aggregate borrowing limits from 1 July 2026; the $20,000 annual and $65,000 aggregate Parent PLUS caps; the $257,500 lifetime maximum for a student borrower; proration of annual limits for part-time enrolment; the 1% automatic debit reduction and its June 2028 expiry.

The rules behind this calculator were last checked on .

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