Calculate student loan payments by entering in the amount of the student loan balance, the loan term in years and the annual interest rate. Values for update automatically each time you change one of the inputs.
How To Use A Student Loan Calculator
Colleges and universities are more accessible than ever, and it’s not uncommon these days to encounter students that are the first in their families to attend college. That said, obtaining a higher education and improving your job prospects and earning potential in the process is not cheap.
There are ways to reduce costs. Many young adults choose to work and attend accredited online universities, for example, while others attend community college for a couple of years before going on to a 4-year institution to complete major study. However, even with these cost-saving measures, most students still end up with some amount of student loan debt.
In some cases, this debt can prove to be a massive burden to young adults just starting their professional lives. Entry-level salaries are not typically high, and it can take time to establish a reputation and climb the corporate ladder, increasing pay along the way. This leaves many graduates struggling to cope with the cost of paying off student loans.
Before students get into this pickle, they may want to determine how long it will take to pay down student loans after graduation, and a student loan calculator is the perfect tool for the job. What is this tool and how does it work?
How Does a Student Loan Calculator Work?
Whether you’re considering accepting student loans or you’ve already graduated and you’re trying to set a budget, a student loan calculator can help you determine how to set manageable monthly payments or reach your goal of completely paying off debt by a certain date.
You’ll need to have a couple key pieces of information available before you get started so you can input them into the calculator. Common inputs include:
- Initial loan amount
- Interest rate
- Loan term in months or years
With this information, you can easily calculate monthly loan payments or even figure out how to pay down your loan faster than the original loan term. You’ll start by entering the initial loan amount, or if you’ve already started making payments, your current balance owed. You need this precise number to break-out monthly payment amounts. Of course, you also have to factor in added interest as it accrues, which is why it’s important to input the interest rate, as well.
From there you’ll simply add the loan term in months or years to determine the amount of your monthly payments in order to pay the loan off on time. Say your student loans total $50,000 and you’re on a 30-year repayment plan at an interest rate of 4%. Your monthly payments will come out to $238.71 monthly. What if you want to pay it off in 20 years? You’ll have to pay $302.99 each month, but you’ll shave off some interest charges in the process, saving you money in the long run.
How Can a Student Loan Calculator Help You?
If you want to quickly compare monthly payments with different loan terms or figure out what it will cost you to pay down student loans faster, there’s nothing quicker or more convenient than plugging numbers into a student loan calculator to see instant results. With this handy tool, you have the information needed to arrange a more manageable payment schedule or save money by paying down loans more quickly.