How to use the student loan calculator
- Enter the loan amount you borrowed.
- Enter the annual interest rate and the loan term in years.
- Add a grace period if your loans defer payments while you study.
- Read your monthly payment, total interest and total cost.
Amortization in plain terms
Each payment is split: part pays the interest accrued that month, the rest reduces the balance. Early payments are mostly interest; later payments mostly principal.
A worked example
A $30,000 loan at 5.5% for 10 years has a monthly rate of 0.4583% and 120 payments. The monthly payment is about $326, total interest about $9,100, and total paid about $39,100.
Grace periods cost you
During a grace period you typically pay interest only. That interest still accrues and is added to the balance, so a longer grace period means a higher total cost even if the monthly payment looks lower at first.