Use this free student loan calculator to calculate student loans by entering your loan details to see how it will work out for you, either yearly or monthly.
What is a student loan?
A student loan is money a student borrows to pay for the education that must be repaid with interest. These loans help students to cover tuition, books, housing, and other college costs when personal savings and scholarships aren’t enough.
A loan differs from a grant or scholarship in that it provides a legal obligation for the student to repay the money borrowed, plus interest for the agreed period, usually after graduation.
Student loans may come from government programs or private lenders, with federal loans normally offering more flexible repayment options and potentially lower interest rates than private loans.
What is a Student Loan Calculator?
A student loan calculator is a financial tool created to help students understand and plan for their student loan repayment.
Student loan calculator key term explanation
Loan Amount
The loan amount is the money borrowed to fund your educational expenses. This figure includes tuition fees, accommodation costs, books, and other educational materials. When entering your loan amount, it is advisable to include all borrowed funds across your student loans if you are calculating total repayment.
The amount you input directly affects your monthly payment calculation and the total interest you will pay over the loan period. Higher loan amounts will result in larger monthly payments and more interest you will pay over time.
Remaining Term in Years/Months
The remaining term field allows you to specify how long you will repay your student loan, measured in either years or months. Standard student loans have repayment terms ranging from 10 to 25 years, though this will vary based on your loan type and repayment option. A longer-term spreads your payments over more time, resulting in lower monthly payments but higher total interest paid.
Interest Rate
The interest rate is the percentage charged by your financial institution for borrowing the loan amount, essentially the cost of borrowing money. For students, this rate may be fixed (remaining the same throughout the loan term) or variable (fluctuating based on market conditions). The interest rate will impact your monthly payment and the total amount you will pay over your loan period.
Monthly Payment
The monthly payment is the amount you’ll need to pay each month to satisfy your loan obligations and fully repay the loan by the end of the term. This figure is calculated based on the loan amount, interest rate, and repayment term you’ve entered. Your monthly payment remains consistent throughout the standard repayment period, though the proportion that goes toward principal versus interest changes over time. Initially, a larger percentage of your payment goes toward interest, but as your principal balance decreases, more of each payment is applied to reduce the principal amount. This calculator provides this value automatically once you’ve entered your loan details, giving you a clear picture of your monthly financial commitment.
Total Payment
The total payment is the cumulative amount you will pay over your loan period, combining the principal (the original amount borrowed) and all interest charges. This figure can be eye-opening for many borrowers, as it shows the true cost of financing your education.
For example, a $30,000 loan at 5% interest over 10 years will require more than $30,000 in total payments. The calculator prominently displays this total, helping you to understand the full financial impact of your student loan beyond just the amount borrowed. This awareness can motivate more aggressive repayment strategies or consideration of refinancing options to reduce the overall cost.
Total Interest
The total interest is the portion of your total payment that goes toward interest rather than paying the principal. This figure is the actual cost of borrowing the money for your education. The total interest depends on your loan amount, interest rate, and repayment term, with longer terms resulting in substantially higher interest payments. If you understand this figure, it helps you evaluate the true cost of your loan and can influence decisions about prepayment, refinancing, or choosing between different repayment plans. The visual chart in the calculator further emphasizes this relationship by showing the proportion of principal to interest in your total payment, making the concept more tangible and easier to grasp.
Payoff Date
The payoff date indicates when you’ll make your final loan payment and be completely free of student debt, assuming you make all payments as scheduled. This date is calculated based on the current date plus the number of months in your repayment term. When you see your payoff date, it motivates and sobering as it provides a concrete timeframe for your debt-free future.
For many students, especially those of you with longer repayment terms, this date may be many years in the future, highlighting the long-term commitment involved with student loans. The calculator automatically updates this projection as you adjust other parameters, helping you visualize how changes to your repayment strategy might affect your financial timeline.