To make loan payments comfortably, you'll need to maintain a manageable debt-to-income ratio. For example, if your expected starting salary is $35,000 per year ($2,916 per month) a monthly student loan payment of 8 percent should be no more than $233.
Among borrowers who attended some college but don't have a bachelor's degree, the median owed was between $10,000 and $14,999 in 2023. The typical bachelor's degree holder who borrowed owed between $20,000 and $24,999. Among borrowers with a postgraduate degree the median owed was between $40,000 and $49,999.
With $50,000 in student loan debt, your monthly payments could be quite expensive. Depending on how much debt you have and your interest rate, your payments will likely be about $500 per month or more. Your potential savings from refinancing will vary based on your loan terms.
Personal finance specialists often advise students to take on less student loan debt than the average starting salary of their desired career. If you stick to this guideline, specialists say, you should be able to repay your loans within ten years.
Loan Forgiveness Timeline: Federal student loans can be forgiven after 10 years through Public Service Loan Forgiveness (PSLF) or after 20-25 years under Income-Driven Repayment (IDR) plans.
Is that too much debt? A general rule of thumb for borrowing is that a college graduate should not take on more debt than their anticipated starting salary for their expected career. Most post-undergraduate positions have starting salaries above the $29,100 average debt amount.
Nearly eight in ten students graduate with less than $30,000 in debt. Among those who do borrow, the average debt at graduation is $27,100 — or $6,775 for each year of a four-year degree at a public university.
Rule of thumb #2: loan payments should be less than 10% of your gross income. Another way to avoid taking on too much student debt and ensure affordable payments is to see how much you'll pay on your student loans each month after graduation.
The average student borrower takes 20 years to pay off their student loan debt. 43% of borrowers are on the standard 10 years or less plan with fixed payments. Some professional graduates take over 45 years to repay student loans.
If your monthly payment does not cover the accrued interest, your loan balance will go up, even though you're making payments. Unpaid interest will also capitalize each year until your total balance is 10% higher than the original balance. This means you will pay interest on your interest.
Regardless, one rule of thumb for student debt is that you should try not to borrow more than the first year salary you can expect in your chosen field. For example, if you expect to earn $38,000 in the first year of your career, you should try to borrow $38,000 or less for your degree.
On average, it takes about 10–20 years to pay off a student loan. But with the right strategy, you can pay off your loans way faster! (I'm about to blow your mind.) Exactly how long it will take you to pay off your student loans depends on your original loan balance, your repayment plan and how much you pay each month.
Among master's degree completers who had student loans, the average balance was higher for those who attended private for-profit institutions ($90,300) than for those who attended private nonprofit institutions ($71,900), and both were higher than the average balance for those who attended public institutions ($54,500) ...
Average Student Loan Debt Statistics
The average student loan debt borrowed for a four-year bachelor's degree was $30,500 in 2019-2020, according to the National Center for Education Statistics (NCES). The average federal student loan debt has more than doubled since 2007, from $18,233 in 2007 to $37,850 in 2024.
Meanwhile, 1 million people had a federal student loan balance of more than $200,000, up from 600,000 individuals.
There's a general rule that you shouldn't borrow more in student loans than you expect to make in your first year out of college. A bachelor's degree recipient's average student loan debt in 2021 was $29,100. In theory, a graduate with a salary above this could handle a 10-year standard repayment plan.
The average outstanding federal student loan debt per borrower is $37,853. 52.6% of indebted borrowers owe $20,000 or less in federal student loans. 32.1% of indebted student borrowers owe $10,000 or less in federal student loans. 15.0% of borrowers owe less than $5,000.
College is a good investment
By 2021, the difference had grown to 62 percent (and closer to 90% for workers with graduate degrees). Currently, California workers with a bachelor's degree earn a median annual wage of $81,000.
At what age do student loans get written off? There is no specific age when students get their loans written off in the United States, but federal undergraduate loans are forgiven after 20 years, and federal graduate school loans are forgiven after 25 years.
If you work full time for a government or nonprofit organization, you may qualify for forgiveness of the entire remaining balance of your Direct Loans after you've made 120 qualifying payments—i.e., at least 10 years of payments. To benefit from PSLF, you need to repay your federal student loans under an IDR plan.
Are student loans forgiven when you retire? No, the federal government doesn't forgive student loans at age 50, 65, or when borrowers retire and start drawing Social Security benefits. So, for example, you'll still owe Parent PLUS Loans, FFEL Loans, and Direct Loans after you retire.