How Long Does it Take to Pay Back Student Loans?

FT Contributor  | 

The average time to pay off student loans depends on each individual borrower’s situation. In particular, the time it takes to pay off a student loan depends on your repayment plan.

Standard Repayment Plan

A benchmark of college loans, the standard repayment plan is a federal student loan program that provides a 10-year window during which the loan must be repaid.

While the monthly payment depends on the size of the loan, smaller loans don’t necessarily have proportionately smaller payments, as there’s typically a minimum payment of around $50 per month. This makes a standard loan an up to 10-year loan that can often be paid off in under a decade.

Extended Repayment Plan

An extended repayment plan is structured based on the size of your debt. When a student’s debt is not consolidated, their loan is eligible for up to a 25-year repayment plan.

If, on the other hand, the debt is consolidated, a different structure is used in which the length of time is gradually extended depending on the size of the loan. Repayment periods can be anywhere from 10 to 30 years under this structure, with longer repayment plans for larger loans.

Graduated Repayment Plan

A graduated repayment plan once again gives students up to 30 years to repay their loans, depending on the size of the loan itself. However, in this case, the initial payments typically begin by requiring an amount slightly above your interest payments.

Over time, these payments increase in order to slowly chip away at the principle of the loan as well. This provides students with a period of time to build their income before heftier payments are due. The repayment period, as calculated by your total loan indebtedness, is as follows:

  • Under $7,500 takes less than 10 years.
  • $7,500 to $10,000 takes 12 years.
  • $10,000 to $20,000 takes 15 years.
  • $20,000 to $40,000 takes 20 years.
  • $40,000 to $60,000 takes 25 years.
  • Over $60,000 takes 30 years.

Income-Driven Repayment Plans

Several additional income-driven payment plans have become available more recently as well. These are contingent on the amount of income you have and can also take into account family size, thus easing the pressure of repaying student loans as graduates go about getting their financial footing.

Income-Contingent Repayment (ICR) Plan 

First, we have an income-contingent repayment plan. This is a number that will vary depending on your own particular situation. It is calculated based on either 20% of your discretionary income — that is, the income that you have in excess of the poverty line — or what your fixed payment would be on a 12-year loan that is, once again, adjusted according to your income.

The plan scales infinitely with your income and can take into account your spouse’s income. The plan phases out after 25 years, at which point the remaining debt is forgiven.

Income-Based Repayment (IBR) Plan

An income-based repayment plan, while similar to its income-contingent cousin, has a couple of significant differences. First, the amount of the payment is based on one of two scenarios. If you borrowed on or after July 1, 2014, IBR is generally calculated based on 10% of your discretionary income. If you borrowed before that date, your rate is calculated based on 15% of your discretionary income. Once again, it also takes into account the spouse’s income if you file taxes jointly.

In addition, rather than scaling infinitely, the monthly payment of an income-based repayment plan can only reach the size of a standard 10-year payment plan.

The remaining debt is forgiven after 20 years if you borrowed on or after July 1, 2014, and is forgiven after 25 years if you borrowed before that date.

Pay-As-You-Earn Repayment (PAYE) Plan

The Pay-As-You-Earn repayment plan, while still income-based, varies when it comes to the specifics.

This time your payment is calculated by 10% of your discretionary income above 150% of the poverty line. Like an income-based plan, it cannot exceed the equivalent of a monthly payment for a 10-year plan and it includes your spouse’s income only if you file your taxes jointly. In this case, the debt is forgiven after a 20-year period.

Revised Pay-As-You-Earn Repayment (REPAYE) Plan

Finally, we have the Revised Pay-As-You-Earn repayment plan. It is similar to the PAYE plan with three notable exceptions. While still calculated on 10% of the discretionary income over 150% of the poverty line, the REPAYE plan can scale infinitely as your income increases.

In addition, your spouse’s income is considered regardless of your tax status.

The forgiveness timeline for this loan is still 20 years for undergraduate students, but is extended to 25 years for loans taken out by graduate students.

Actions That Impact How Long It Takes to Pay Off Student Loans

Besides repayment plans, there are a few other factors that can affect how long it takes to repay student loans.

Prioritizing Student Loan Debt

First, consider if you will have any excess income to put towards your student loans. Whether they come through unallocated income, creating a budget, minimal living, or any other source, extra payments can dramatically reduce both the time and interest required to pay off your loans.

Forbearances and Deferments

There are also multiple ways that you can postpone or reduce your loan payments, including deferment and forbearance.

Deferring your loan typically means you’re able to postpone payments without owing added interest on the debt. Eligibility for deferment often revolves around being enrolled in school or having a medical emergency.

Forbearance is simply a delay in payments that does not pause the accrual of interest. Forbearances can be either discretionary or mandatory, depending on your eligibility.

If you opt for either of these two choices, remember that it will extend the amount of time required to pay back your loan.

Consolidation and Refinancing

Choosing to either consolidate or refinance your loans can be an excellent way to create one single loan payment or take advantage of lower interest rates. If you choose to go this route, though, remember that it may reset your loan repayment period.

Delinquency and Default

If you miss a payment on your loan, it becomes delinquent. If repeated payments are missed for several months, the loan goes into default. This can extend how long it takes to pay off student loans due to both the period of time spent not making payments as well as any fines or other consequences associated with allowing the loan to go unpaid.


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This post was updated October 31, 2019. It was originally published October 31, 2019.