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Geeky Insight:

Is The 10-Year Standard Repayment Plan The Best Repayment Option?

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When you’re paying off your federal student loans, you should be familiar with all of your repayment options. The default repayment plan for paying off your federal student loans is called the Standard Repayment Plan. This repayment plan will allow you to pay off your loan balance within 10 years.

Learn more about the Standard Repayment Plan and make sure it makes sense for you.

What is the Standard Repayment Plan?

When it comes time to pay back your federal student loans, chances are your loan servicer will set you up with the Standard Repayment Plan. The Standard Repayment plan is the default repayment plan where you can pay off your loans within 10 years.

The Standard Repayment Plan makes the most sense when paying back your student loans if you can manage the monthly payments. It will save you the most amount of money because you’ll pay off your loan in the shortest amount of time, which means you will pay the least amount of interest over the duration of your loan.

Who is eligible for the Standard Repayment Plan?

The Standard Repayment Plan is available to borrowers with the following loans:

  • Direct Subsidized Loans
  • Direct Unsubsidized Loans
  • Direct PLUS Loans
  • Direct Consolidation Loans
  • Subsidized Federal Stafford Loans
  • Unsubsidized Federal Stafford Loans
  • FFEL PLUS Loans
  • FFEL Consolidation Loans

Who is not eligible for the Standard Repayment Plan?

Private student loans will not be eligible for the Standard Repayment Plan.

What are payments like with the Standard Repayment Plan?

 Your monthly payment will depend on what it takes to pay off your loans in a 10 year timeframe. Under the Standard Repayment Plan you will have a fixed amount to pay each month, and it will at least be $50 (never less) for up to 10 years.

If you have a Direct Consolidation Loan or FFEL Consolidation Loan the $50 minimum payment still applies, but your payment term can extend up to 30 years.

The only exception is if you have a Direct Consolidation Loanor FFEL Consolidation Loan. If you have either of those two you can make payments for up to 30 years. It’s important to note that the payment amount will be determined by all your student loan debt, not just what you owe with consolidated loans.

What are other options besides the Standard Repayment Plan?

You have a few options when it comes to federal student loan repayment:

Final Thoughts

 If you can swing it, the Standard Repayment Plan is the best option. While your monthly payment might be a little higher than some of the other options, you will save the most amount of money on your loan and get out of debt faster. You have options when it comes to paying back your student loans, just remember the sooner you pay it off, the more you’ll save on interest.

See how much you'll earn in interest with a high-yield saving account

How much will you deposit into your savings account?

$

What is the APY on the savings account?

%

You can expect to earn this much in interest:

$338