How Long Does It Take To Pay Off Student Loans?

As of 2023, 45 million Americans have student loan debt. The total student loan debt in America is a whopping $1.75 trillion^[1] (including federal and private loans), and the average borrower balance is almost $40,000.

Carrying a lot of loan debt is a stressful way to start your career. When most people take out student loans, understandably, the first thing they want to know is how much time it will take to pay them off. The answer depends on many factors, including the type of loan you have taken out. 

Timetable for Student Loan Repayment

There are two types of student loans — federal student loans and private loans. The time it takes to repay your loans depends on what type you have. 

How Long Does It Take to Repay Federal Student Loans? 

It generally takes 10 to 30 years to repay federal student loans. The exact timeline depends mostly on your repayment term. The repayment term — how long you have to repay your loan — will be based on what repayment plan you’re enrolled in.

Students who graduate (and those who quit school) with federal student loan debt are automatically enrolled in the Standard Repayment Plan, which has a 10-year repayment term. While it probably sounds great to pay off your loans in 10 years, many people aren’t able to afford the monthly payment under this plan and end up changing to an income-based repayment plan. These plans can last up to 30 years.

As a general rule, remember: The longer the repayment term, the lower the monthly payment, but the more you’ll pay in interest over time. The shorter the repayment term, the higher the monthly payment, but you’ll pay less in interest overall. 

Who Qualifies for Federal Student Loans?

Federal student loans are available to students who are enrolled in colleges or universities that participate in federal student financial aid programs. The federal government funds and sets the loan terms for these loans. 

Unlike privately funded loans, federal loans have fixed interest rates, income-based repayment options, loan forgiveness plans, and deferment options. Finally, most federal loan borrowers aren’t subject to credit checks.

To apply for a federal student loan, you must submit a Free Application for Federal Student Aid (FAFSA). Submitting a FAFSA is often the first step for students applying to college or graduate school. 

How Long Does It Take To Repay a Private Student Loan?

Private student loans are loans you take out with a private lender. Private lenders have their own repayment options. Private student loans tend to carry higher interest rates than federal loans, and the rates aren’t fixed like federal loans. 

Also, your credit score and credit history matter when applying for a private student loan. If you have excellent credit, it’s possible to get a better interest rate with a private loan than with a federal loan. Unlike federal student loan programs, private student loans don’t offer loan forgiveness programs. 

Unless you refinance your loan along the way, you can expect to repay a private student loan in 5 to 20 years.

What Federal Student Loan Repayment Plans Are There? 

Federal student loans offer several income-driven repayment plans and three repayment plans that aren’t income-driven:

• The Standard Repayment Plan has a 10-year term and a fixed monthly payment amount. If you have a Direct Consolidation loan, the term may be from 10–30 years.

• The Graduated Repayment Plan has a 10-year repayment term (or 10–30 years if you have a Direct Consolidation Loan). Unlike the Standard Repayment Plan, monthly payments in the Graduated Plan start low and gradually increase over time, usually every two years. This can be an advantage if you’re not making much money right after you graduate but plan to make more as you build your career.

• The Extended Repayment Plan has a 25-year term, and your payments may be fixed or graduated.

What Income-Driven Repayment Plans Are There?

Depending on the loan type, you can also apply for one of the five types of income-driven repayment plans:

• Pay As You Earn Repayment Plan (PAYE Plan): Pay 10% of your discretionary income for 20 years.

• Income-Based Repayment Plan (IBR Plan): Pay 10% of your discretionary income for 20 years if you’re a new borrower (on or after July 1, 2014) or 15% of your discretionary income for 25 years if you’re not a new borrower.

• Income-Contingent Repayment Plan (ICR Plan): Pay 20% of your discretionary income for 25 years or what you would pay on a 12-year repayment plan adjusted to your income.

• Saving on a Valuable Education Plan (SAVE Plan): Pay 5% of your discretionary income (for undergraduate loans), or 10% (for graduate loans) for 10 years (for low balance borrowers), 20 years (for undergraduate loans), or 25 years (for graduate loans).

  • Formerly the Revised Pay As You Earn Plan (REPAYE)

Note: You can get an estimate of your student loan payment and get help choosing a repayment plan by using the Loan Simulator on the StudentAid.gov website. 

When Do You Have To Start Paying Off Your Student Loan?

If you have a federal student loan, you’ll be required to begin making monthly payments six months after you graduate, if you drop below half-time enrollment, or if you quit school. The six months after you graduate is referred to as a grace period.

If you can’t make your student loan payments after the grace period ends, you can apply for a deferment or forbearance program. You may also be able to switch to a different repayment plan.

Private student loan lenders also give borrowers a six-month grace period if they graduate, drop below half-time enrollment, or quit school. Some private student loans will extend the grace period for student loan payments to 9 or 12 months post-grad. 

Remember, though, that interest will continue to accrue during this time. You should contact your specific lender to find out when your payments will begin and what repayment options you have.

How To Repay Student Loan Debt Quicker

Student loan borrowers often take much longer than the standard 10-year repayment schedule to fully pay off their student loans. You can shorten the amount of time it takes to repay your student loan debt by taking the following steps. 

Pay More Than the Minimum Monthly Payment

First, if you can afford it, pay more than the minimum monthly payment. The more you pay toward principal, the less you'll pay in interest over the life of the loan, and the less time it'll take to pay off the entire loan amount. Make sure to instruct the lender to apply any extra payment you make to the loan's principal balance. Otherwise, the lender might apply it toward your next scheduled payment.

Make More Than One Payment Per Month

Making the minimum payments plus an extra payment each month means you accrue less interest between payments. Again, this lowers the total interest you’ll pay over the life of the loan and decreases the time it’ll take to pay off the loan. You could also set up half-payments (1/2 of the minimum monthly payment amount) for every two weeks (bi-weekly) instead of monthly. This way, you end up making one full extra payment a year. 

It Helps if You Can Create a Budget

Paying down your student loan balance as quickly as possible is a great personal finance goal. If possible, adjust your budget to pay a little more than your minimum monthly payment. This can result in significant savings over time. And if you get a raise or a financial windfall such as an income tax refund, put some of that money toward your student loan repayment. 

Refinance Your Student Loan to a Shorter Term

Consider refinancing your student loan to a shorter loan term if you can make higher monthly payments. If you have good credit, you may get a lower interest rate, saving you lots of money in interest over time. But remember, refinancing a federal student loan converts it to a private loan. This means you’ll no longer be eligible for income-driven repayment plans or loan forgiveness programs that federal loans offer. 

To refinance your student loan, contact your loan servicer. A loan servicer acts as a middleman between you and your lender. Loan servicers can help you change your repayment plan, apply for student loan forgiveness, and pause your loan payments. 

Things That Can Influence the Student Loan Repayment Period

Refinancing your student loan or entering a deferment or forbearance program can affect how long it takes to repay your loan.

Refinancing with new loan terms (and often with a new lender) can change how much time it takes to pay off student loan debt:

• If you refinance your loan to get a shorter term, it typically increases your monthly payments. So, you’ll pay off the loan faster, but your monthly payments will be higher. 

• If you refinance to lower your monthly payments, you’ll generally increase your loan term, and it will take longer to pay off the loan. This can also increase the total interest you’ll pay over the life of the loan.

Deferment or forbearance programs allow borrowers to pause payments if they’re unemployed, suffering from health issues, serving in the military, or having financial difficulties. These programs will extend the loan's final due date. They may also add accrued but unpaid interest to the loan balance, which will increase the total student loan interest. Learn more by reading our article: Student Loan Deferment vs. Forbearance: What’s the Difference?

What’s Happening with the Biden-Harris Student Loan Debt Plan? 

In August 2022, the Biden-Harris administration and the U.S. Department of Education announced a student loan forgiveness plan. The program was to be open to most federal student loan borrowers whose annual income for 2020 or 2021 was either below $125,000 (for individuals) or $250,000 (for couples or heads of households).

Unfortunately, the Supreme Court shot down this proposed program in the Summer of 2023. After a three and a half year payment pause, student loan interest begins accruing in September of 2023 with monthly student loan payments beginning again in October of 2023.

What if You Can’t Pay Your Student Loan Debt?

One study showed that it takes an average of 21 years to repay student loan debt^[2]. A lot can happen during that time! This is why it’s no surprise that about 1 in 10 student loan borrowers can’t repay their debt.^[3] This may be due to prolonged bouts of underemployment or unemployment, unforeseen medical expenses, or other financial setbacks. 

If you are struggling to repay your student loan debt despite making efforts to change your repayment plan, apply for forbearance or deferment, or otherwise increase your income and decrease your expenses, you may be able to discharge your debt in bankruptcy.

To do so, you’ll need to prove the student loan repayment is causing “undue hardship.” The Department of Justice recently clarified what this means for federal student loan borrowers. You can read more about that here: Yes, You Can File Bankruptcy on Student Loans. Here’s How.