What is the Minimum Student Loan Payment?

The minimum student loan payment is the lowest possible amount you need to pay each month on your student loans to keep them in good standing.

However, paying more than the minimum amount due on student loans may help you pay off your loans faster and save money overall. Here’s what borrowers need to know about the difference between paying the minimum on student loans and paying more.

What Is the Minimum Payment on Student Loans?

The minimum payment on student loans is the lowest amount of money a borrower can pay each month to stay current on their loans. The student loan minimum payment amount due is typically determined by factors including the loan type, interest rate, and the student loan repayment plan chosen. Generally, a minimum monthly payment includes the loan principal, interest, and fees.

For federal student loans, the minimum monthly payment depends on the repayment plan a borrower is on, including the following: (Note: While the One Big Beautiful Bill that was passed in July 2025 eliminates a number of federal repayment plans, because current borrowers may remain on some of plans, they are all included in the list below.)

Standard Repayment Plan: This plan closed to borrowers with loans that were issued on or after July 1, 2026. Borrowers currently on the Standard Repayment Plan have a 10-year repayment period with fixed monthly payments. The minimum payment on the plan is $50.

Pay As You Earn (PAYE) Plan: This plan is closed to new loans made on or after July 1, 2026. Under PAYE, borrowers’ payments are 10% of their discretionary income and are also based on their family size. With PAYE, payments could be as low as $0 per month.

Those currently on PAYE have the option of switching to IBR before July 1, 2028, when PAYE will be shut down.

Income-Based Repayment (IBR) Plan: IBR is available to any borrower currently in an income-driven repayment plan that is scheduled to close. Borrowers on IBR generally have federal student loan debt that’s higher than — or comprises a substantial portion of — their annual discretionary income.

On IBR, borrowers’ monthly payments are 10% to 15% of their discretionary income and could be as low as $0; payments are also based on family size. IBR will forgive any remaining balance owed at the end of the loan term.

Income-Contingent Repayment (ICR) Plan: This plan will be closed to new loans made on or after July 1, 2026. Borrowers with Direct loans who are on this plan have monthly payments that are the lesser of 20% of their discretionary income or the amount they would have paid on a fixed repayment plan over 12 years, adjusted for their income; payments could be as low as $0.

Borrowers on ICR have the option of switching to IBR before July 1, 2028, when ICR will be closed down.

Saving on a Valuable Education (SAVE) Plan: The SAVE plan is no longer available, and it’s scheduled to be eliminated completely by June 30, 2028. Borrowers on SAVE can move to another plan; those who don’t make the switch by July 2028 will likely be moved to the IBR plan.

Graduated Repayment Plan: This plan will be closed to new loans issued on or after July 1, 2026. With this plan, a borrower’s monthly payments are lower at first and then increase, usually every two years. The monthly amounts paid by those currently on the plan are enough to repay their loans within 10 years.

Extended Repayment Plan: This plan will be closed to new loans issued on or after July 1, 2026. For those on the Extended plan, their payments may be fixed or graduated, and the amount they paid each month is enough to ensure their loans will be paid off in 25 years.

For borrowers taking out their first loans on or after July 1, 2026, there will be only two repayment options:

•   Tiered Standard Plan: This plan has fixed payments with a term based on the loan amount and ranging from 10 to 25 years. Generally, the more you owe, the longer you will have to repay it.

•   Repayment Assistance Program (RAP): This new program is similar to previous income-driven plans that tied payments to income level and family size. On RAP, payments range from 1% to 10% of adjusted gross income for up to 30 years. At that point, any remaining debt will be forgiven. If your monthly payment doesn’t cover the interest owed, the interest will be canceled. All borrowers are required to pay at least $10 per month on RAP.

Can I Pay More Than The Minimum on Student Loans?

It’s possible to make more than the minimum payment on student loans without any prepayment penalty fees. Both federal student loans and private student loans are typically required to allow borrowers to make extra payments and pay off their loan early without charging additional fees.

Making extra payments can help decrease the interest a borrower pays and help reduce the overall cost of the loan. Typically, you can contact your lender to specify that the extra payment be applied to the loan principal of your highest interest loan.

Making principal-only payments on student loans can help borrowers pay off student loans faster. And, because most student loan interest is charged per day, making additional payments on the principal value of the loan can also help reduce the amount you pay in interest over the life of the loan.

Why Would You Pay off Your Student Debt Sooner?

A primary motive for paying off student debt early, and one of the ways to manage student loan debt, is to reduce the interest loans accrue. Prioritizing debt repayment could also help lower your debt-to-income ratio and reduce the amount of money you owe over the life of the loan. Here are some reasons borrowers may want to pay off student loans sooner rather than later.

Interest. Interest. Interest.

Interest continues to accrue over the life of most student loans. The sooner you pay off your loans, the sooner you’ll save on interest by stopping it from building up.

Your Debt-to-Income Ratio May Be Lowered

When an individual applies for a mortgage or a car loan, the lender will usually consider their debt-to-income (DTI) ratio, which is the amount of debt they have compared to their income. And the lower their DTI is (ideally, 36% or less), the better it is from a financial perspective. The sooner you get your student loan debt paid off, the more money you may have to put toward goals like a car, a house or starting a family.

Your Credit Might Strengthen

A person’s credit is an important component of their total financial picture. Making on-time student loan payments may have a positive impact on credit. And stronger credit might help an individual get a lower interest rate on a mortgage or car loan.

It’s Easier to Save Money When You’re Not Paying Down Debt

The less debt you have, the easier it may be to save. Once you’ve repaid your student loans, you can direct the money you were spending on monthly loan payments toward reaching financial goals like building an emergency fund, saving for a down payment on a house, or saving for retirement.

How to Accelerate Your Student Loan Payments

You may be able to pay off your student loan debt more quickly by making more than the minimum student loan repayment required. Here are some strategies that may help eliminate student loan debt sooner.

Calculating Your Costs

Make a list or spreadsheet of all your student loans. Then, add up how much you owe in total (including interest). You can plug that number into a student loan calculator along with the number of years in which you’re hoping to repay your loans to help determine what your monthly payments might be to reach your goal.

Making a Budget

Track your spending and make a realistic budget of your monthly and annual expenses. Be honest with yourself. If you think you’re spending too much on unnecessary items, it may be time to cut back.

Setting Manageable Goals

Once you have a budget in place, review it carefully with the goal in mind of paying off your student loans by a certain date. Are there expenses you can eliminate? Perhaps you could give up your gym membership and take up running instead. And maybe you only need one streaming service instead of three. Cooking at home instead of eating out and taking advantage of low- or no-cost entertainment and cultural activities can also help free up more cash to put toward student loan payments.

Paying Beyond the Minimum Required

You can accelerate your loan payoff by paying more than the minimum student loan payment required. It’s okay to start small — even an extra $25 a month can add up. You could also explore the idea of making weekly vs. monthly student loan payments, which may help you repay your loans faster. Ask your loan servicer to put any extra cash you pay toward the loan principal.

Avoiding Late Fees

An easy way to help ensure you pay your loans on time every month is to set up automatic payments. Many lenders even offer a small interest rate discount to student loan borrowers who enroll in auto-pay, which could also save you money.

Maximizing “Surprise” Money

If you get a raise or bonus at work, direct that money toward your student loan debt. The same goes for birthday gifts and other “found” money. Putting those funds to work for you can help you pay down what you owe faster.

Finding Extra Work

Every little bit of extra cash can help. And funds from a part-time job could get you closer to your goal more quickly. If fitting an extra 10 or 15 hours a week isn’t feasible, consider a side hustle that allows you to set your own hours. You could work as a dog walker, rideshare driver, or tutor, for example.

Recommended: What is the Average Student Loan Debt After College?

Refinancing Your Student Loans

Some borrowers might want to explore the idea of refinancing their student loans. With student loan refinancing, a borrower replaces their existing loans with one new loan from a private lender, ideally, with a new interest rate and/or more favorable loan terms.

One potential benefit of refinancing is the possibility of securing a lower interest rate, if you qualify, which might lower your student loan payments. You may also be able to shorten your loan repayment term. Just know that shortening your loan term generally means paying more each month.

If you have a combination of private and federal loans, it’s possible to roll them into a single refinanced loan, which means having one monthly payment instead of multiple payments to multiple lenders.

However, it’s very important to understand that by refinancing federal loans, you lose federal student loan protections such as forgiveness and deferment and forbearance, and access to income-driven repayment programs. Take this into careful consideration before moving forward with student loan refinancing.

The Takeaway

Making more than the minimum student loan payments each month may help borrowers speed up their loan repayment and spend less in interest over the life of their loan. To make the most of their extra payments, borrowers can contact their lender and tell them to put the money toward the principal of the loan.

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

With SoFi, refinancing is fast, easy, and all online. We offer competitive fixed and variable rates.

FAQ

What happens if I only pay the minimum on my student loans?

Making the minimum monthly payments on your student loan will generally result in your loan being paid off according to the original terms of the loan.

Is it worth paying off student loans early?

Paying off student loans ahead of schedule can make borrowing less expensive, because the borrower will likely spend less in interest over the life of the loan. Repaying student loans early may also have benefits like improving an individual’s debt-to-income ratio, and freeing up money for them to put toward other financial goals.

What is the average minimum student loan payment?

The average federal student loan payment for borrowers with a bachelor’s degree is approximately $300 a month, according to the Education Data Initiative. However, a borrower’s specific minimum student loan payment depends on factors including the total amount they owe, their interest rate, and the type of payment plan they’re on.

How is the minimum payment on student loans calculated?

The way minimum payments on student loans are calculated depends on whether the student loans are federal or private and what payment plan the borrower is on. For example, the Standard Repayment Plan for federal loans calculates payments using a formula that ensures the total balance plus accrued interest will be repaid in 10 years. Income-driven repayment plans base payment amounts on a percentage of a borrower’s discretionary income while also factoring in their family size. Private lenders typically use a borrower’s loan amount, loan term, and interest rate in a formula to calculate payments.

Does paying the minimum on student loans hurt your credit?

As long as a borrower makes their full minimum payments on time every month, paying the minimum owed on their student loans does not negatively impact their credit.

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