In order to help you with the grace of sharing the vital information of knowing how long does it take to pay off student loans as a student who is indebted to the academic institution attended or the government that sponsored through student loan, sufficient variables have been garnered during research purposely to resolve the question.
It is not to be denied that there is variation when it comes to the institutional or state laws which guide debt repayment duration or period of debt recovery. This relies on the legal statement adopted by concerned schools or government in charge of the program and which is agreed on by the interested students. The truth is that student loans can take 5-20 years or longer to repay. And, the average time to pay off student loans depends on a borrower’s loan amount, interest rate, and how much they can afford to pay each month.
Student loan debt varies by race and gender. So does median income. It takes the average female college graduate longer to repay their debt than the average male graduate, and it takes the average Black college graduate longer to repay than the average white graduate.
Now back to the question, how long does it take to pay off student loans?
Regularly, it takes 10 years to pay off student loan debt on the standard federal loan repayment plan. However, some undergraduate borrowers may be able to pay off student loans faster by making larger payments.
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By Gender and Race
Women and Black students are more likely to take out federal loans and borrow higher amounts on average than male and white students, respectively. Additionally, income inequality which includes the gender pay gap and racial wealth gap can impact borrowers’ ability to pay off loans.
As such, average student loan payoff times vary by gender and race. Assuming that borrowers can pay 10% of their monthly income against their student loan debt, it would take the average female bachelor’s degree-holder about one and a half years longer than the average male to repay their student loans.
Also, it would take the average Black bachelor’s degree-holder twice as long as the average white borrower to repay their student loans.
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Masters Degree
Graduate degrees typically cost more than undergraduate degrees. So, graduate students tend to borrow more and can take longer to pay off their loans. While higher degrees correlate with higher earnings, graduate degree-holders can still take longer than undergraduate degree-holders to pay off their debt.
Read Also: University that Has the Most Debt
If the average master’s degree-holder pays 15% of their monthly income against their debt, they could repay their debt in about four years on the average man’s salary and almost six and a half years on a woman’s salary.
- Federal Government General Loan Repayment Plan
The standard federal student loan repayment plan divides monthly payments over 10 years. However, borrowers have options. Borrowers with multiple federal student loans can consolidate loans and make payments over 10-30 years. In addition, the government offers income-driven repayment plans allowing borrowers to make smaller payments over a longer period.
For instance, the diagram below shows a sample of what it entails:
| Monthly Payment | Time to Repay Average Student Loan Debt |
|---|---|
| $300 | 10 years, 4 months |
| 10% of monthly income | 5 years, 4 months |
| 20% of monthly income | 2 years, 6 months |
