The short answer
- $30,000 at 6.52% on the 10-year standard plan costs $340.95 a month and $10,914 in interest.
- Paying $100 extra a month clears it 34 months sooner and saves $3,359.
- RAP sets the payment at 1% to 10% of your adjusted gross income, less $50 per dependent, with a $10 minimum.
- Federal loans made from July 1, 2026 to June 30, 2027 charge 6.52% (undergraduate), 8.07% (graduate) and 9.07% (PLUS).
How student loan payments work
Federal and most private student loans charge simple interest on the balance each day. Your monthly payment covers that interest first and the rest reduces the principal. On a fixed plan the payment stays the same, so the interest share falls over time. On graduated plans the payment rises every two years, and on income-driven plans it follows your income.
Interest usually builds up while you are in school and during the grace period (six months for most federal loans) on unsubsidized loans. The calculator starts from the balance you owe today, so include any interest already added.
Federal interest rates for 2026–27
| Loan | Rate | Legal cap |
|---|---|---|
| Undergraduate (subsidized and unsubsidized) | 6.52% | 8.25% |
| Graduate unsubsidized | 8.07% | 9.50% |
| PLUS (graduate and parent) | 9.07% | 10.50% |
Each year’s rate is the yield at the May auction of 10-year Treasury notes plus a margin set by law: 2.05 points for undergraduates, 3.60 for graduate loans and 4.60 for PLUS loans. The May 2026 auction yielded 4.468%. The rate is fixed for the life of each loan, so loans from different years have different rates. Federal loans also charge an origination fee taken from each payout.
What changed on July 1, 2026
- March 2026SAVE ends
A federal court vacated the SAVE plan rule; borrowers in SAVE forbearance are being moved to other plans.
- July 1, 2026RAP opens
The One Big Beautiful Bill Act's Repayment Assistance Plan starts. Loans made from this date can use only the new standard plan or RAP.
- By July 1, 2028PAYE and ICR end
Borrowers still in them move to IBR or RAP. Payments already made keep counting toward forgiveness.
Loans made before July 1, 2026 keep access to the older standard, graduated and extended plans and to Income-Based Repayment (IBR). If you take a new loan after that date, including a new consolidation loan, your options narrow to the two new plans.
The standard plan
- Monthly payment$340.95
- Number of payments120
- Total interest$10,914
The 10-year standard plan has the highest fixed payment among the older plans but the lowest total cost. It is the default for loans made before July 1, 2026 if you do not choose another plan.
The standard plan for new loans
For loans made on or after July 1, 2026, the standard plan has fixed payments over a term set by the amount you owe:
| Amount owed | Term |
|---|---|
| Less than $25,000 | 10 years |
| $25,000 to $49,999 | 15 years |
| $50,000 to $99,999 | 20 years |
| $100,000 or more | 25 years |
On $30,000 at 6.52%, that means 15 years at $261.66 a month and $17,099 of interest: about $79 a month less than the 10-year plan, but $6,185 more interest. You can always pay extra to finish sooner.
Extended and graduated plans
| Plan | Payment | Total interest |
|---|---|---|
| Standard, 10 years | $340.95 | $10,914 |
| Graduated, 10 years | $296.44 rising to $403.30 | $11,738 |
| Extended fixed, 25 years | $202.94 | $30,881 |
| Extended graduated, 25 years | $142.41 rising to $358.62 | $39,166 |
Graduated plans start lower and rise every two years, which suits people who expect their pay to grow. Extended plans need more than $30,000 in federal Direct Loans and stretch repayment to 25 years. Both cost more in total. Your servicer sets the actual graduated steps; the calculator lets you change the rise under More options.
Graduated payments can start below the interest
At an 8% rise over 25 years, the first payment of $142.41 is less than the $163 of monthly interest, so the balance grows at first. The federal graduated plans set payments at least equal to the interest.
The Repayment Assistance Plan
RAP is the new income-driven plan created by the One Big Beautiful Bill Act. Under the law and the Department of Education’s guidance:
- Your payment is a percentage of your adjusted gross income ÷ 12: 1% for AGI over $10,000 up to $20,000, rising one point for each extra $10,000, up to 10% above $100,000.
- With AGI of $10,000 or less, you pay $10 a month.
- The payment falls by $50 for each dependent, but never below $10.
- If your payment does not cover the month’s interest, the unpaid interest is not charged, so your balance does not grow.
- If your payment cuts the principal by less than $50, the government adds a match, up to $50 or your payment if less.
- Any balance left after 360 qualifying payments (30 years) is forgiven.
- If you are married, your spouse’s income counts only if you file jointly.
Parent PLUS loans, and consolidation loans that repaid a Parent PLUS loan, cannot use RAP.
RAP payments by income
| AGI | Share | Dependents | Monthly payment |
|---|---|---|---|
| $15,000 | 1% | 0 | $12.50 |
| $25,000 | 2% | 0 | $41.67 |
| $45,000 | 4% | 1 | $100.00 |
| $65,000 | 6% | 0 | $325.00 |
| $95,000 | 9% | 2 | $612.50 |
| $150,000 | 10% | 0 | $1,250.00 |
The share applies to your whole AGI, not just the part in each band, so the payment jumps when you cross a $10,000 line. Moving from $60,000 to $60,001 of AGI raises the share from 5% to 6%.
RAP worked examples
- First payment
- $166.67
- Paid off in
- 14 years
- Total paid
- $48,014
- Principal matched
- $538
- First payment
- $10.00
- Paid off in
- 23 years 7 months
- Interest not charged
- $11,093
- Principal matched
- $7,215
Both examples are for $30,000 at 6.52%, with income rising 3% a year. On a low income, RAP keeps payments tiny while the interest waiver and the principal match still bring the balance down. On a higher income, RAP can cost more each month than the standard plan: at AGI of $120,000, the payment is $1,000 a month.
SAVE, PAYE, ICR and IBR
SAVE has ended after a court ruling in March 2026, and borrowers who were in it must choose another plan. PAYE and ICR end by July 1, 2028, and borrowers still in them then move to IBR or RAP. Income-Based Repayment stays open for loans made before July 1, 2026. It sets payments at 10% or 15% of discretionary income, depending on when you first borrowed. Qualifying payments made under any of these plans keep counting toward forgiveness after a switch.
Check your own options
The rules are still being put into practice. Log in to studentaid.gov or ask your servicer which plans your loans can use before you switch.
Graduate school loans
Graduate loans carry higher rates and bigger balances. $80,000 at 8.07% costs $973.58 a month over 10 years with $36,830 of interest. On the new standard plan for that balance (20 years), the payment falls to $672.64 but the interest rises to $81,434. On RAP with AGI of $70,000, the first payment is $350 and the loan is repaid after about 20 years.
Private student loans
Private loans come from banks, credit unions and online lenders. Rates can be fixed or variable and depend on your credit. They have no income-driven plans, no RAP and no federal forgiveness. Choose "Private" in the calculator and set the term your lender gives you.
Refinancing
Refinancing replaces one or more loans with a new private loan, ideally at a lower rate. It can save money on private loans or on federal loans for people with high, stable incomes. But refinancing federal loans is permanent: you lose RAP, Public Service Loan Forgiveness, deferment options and the interest waiver. Use the general loan calculator to compare offers.
Paying extra
On a fixed plan, extra payments cut interest and shorten the loan. $100 extra a month on $30,000 at 6.52% clears the standard-plan loan in 7 years 2 months instead of 10 years and saves $3,359. Ask your servicer to apply extra payments to the highest-rate loan. If you expect forgiveness under RAP or PSLF, paying extra may simply reduce the amount forgiven.
Before paying extra, make sure you have an emergency fund, any 401(k) match and no higher-rate debt such as credit cards. The debt payoff calculator compares paying off several debts at once.
Public Service Loan Forgiveness
If you work full time for a government or a qualifying nonprofit, PSLF forgives the remaining balance of your Direct Loans after 120 qualifying monthly payments made under a qualifying plan. Payments under RAP and the 10-year standard plan count. Forgiveness under PSLF is not taxed by the federal government.
Taxes and student loans
You can deduct up to $2,500 a year of student loan interest, whether or not you itemize, though the deduction phases out at higher incomes. Balances forgiven under an income-driven plan such as RAP may be counted as taxable income. The federal income tax calculator shows your bracket.
If you cannot pay
Contact your servicer before you miss a payment. An income-driven plan such as RAP can cut payments to as little as $10 a month. Deferment and forbearance can pause payments for a time, but interest may keep building. Federal loans in default can lead to garnished wages and seized tax refunds, so it is worth acting early.
Choosing a plan
- Want to pay least overall? The shortest fixed term you can afford, plus extra payments.
- Low or uncertain income? RAP keeps payments tied to income and stops the balance growing.
- Working in public service? RAP or the 10-year standard plan with PSLF.
- High income and private-sector job? A fixed plan, possibly refinancing if you will not need federal protections.
Subsidized and unsubsidized loans
On a subsidized loan, available to undergraduates with financial need, the government pays the interest while you are in school at least half time, during the grace period and during deferment. On an unsubsidized loan, interest builds from the day the money is paid out. If you do not pay it, it may be added to the balance when repayment starts, and you then pay interest on it.
The cost of unpaid interest
Suppose $1,500 of interest built up on a $30,000 unsubsidized loan while you were in school and is added to the balance. Repaying $31,500 at 6.52% over 10 years costs $358.00 a month and $11,460 of interest, against $340.95 and $10,914 if you had paid the interest as it built up. Paying even part of the interest while in school keeps the balance down.
The auto-pay discount
Federal loan servicers take 0.25 percentage points off your rate when you pay by automatic debit, and many private lenders do the same. On $30,000 over 10 years, cutting the rate from 6.52% to 6.27% lowers the payment to $337.14 and saves $457 of interest. It also means you never miss a payment.
Help from your employer
Employers can pay up to $5,250 a year toward your student loans tax-free, through an educational assistance program. Some also match student loan payments with 401(k) contributions, so you build retirement savings while you repay. Ask your HR department whether either is offered.
Consolidating federal loans
A Direct Consolidation Loan combines several federal loans into one, with one servicer and one payment. The new rate is the weighted average of the old rates, rounded up to the nearest one-eighth of a percent, so it does not lower your cost. Remember that a consolidation loan made on or after July 1, 2026 counts as a new loan, so it can use only the new standard plan or RAP.
Key numbers
| Item | Figure |
|---|---|
| Undergraduate rate, 2026–27 | 6.52% |
| Graduate unsubsidized rate, 2026–27 | 8.07% |
| PLUS rate, 2026–27 | 9.07% |
| RAP payment | 1% to 10% of AGI ÷ 12 |
| RAP dependent reduction | $50 a month each |
| RAP minimum payment | $10 a month |
| RAP forgiveness | After 360 qualifying payments |
| PSLF | After 120 qualifying payments |
| Student loan interest deduction | Up to $2,500 a year |