Average Student Loan Payment

Report Highlights. The average monthly student loan payment is an estimated $536 based on previously recorded average payments and median average salaries among college graduates.

• The average borrower takes more than 20 years to repay their student loan debt.
• 42.9% of borrowers are on the standard 10 year or less plan with fixed payments.
• The average outstanding federal student loan debt per borrower is $38,375.
• 52.4% of indebted borrowers owe $20,000 or less in federal student loans.

Related reports include Average Time to Repay Student Loans | Student Loan Debt Statistics | Average Student Loan Interest Rate | Student Loan Default Rate

Average Student Loan Payments

An appropriate monthly payment is based on multiple variables, including income, total debt, interest rate, and repayment timeline.

• 20% of your gross income (GI) should go toward paying off debts based on the 50-20-30 rule of finance.
• The average monthly student loan payment of $523 is equivalent to 10% of a $62,760 annual GI. $376 monthly payments are 10% of $45,120.
• 36% of income is the maximum amount that should go toward paying off debt according to the 28/36 rule of finance.
• $523 monthly payments are equivalent to 36% of a $17,433 annual GI.
• The average starting salary among all new graduates with bachelor’s degrees is $64,291.
• 10% of the average starting monthly salary for new graduates is $536.
• 42.9% of borrowers are on the standard 10 year or less plan with fixed payments.
• The most commonly used federal student loans have an interest rate closer to 6.53%.
• The average outstanding federal student loan debt per borrower is $38,375.
• 16.0% of borrowers owe less than $5,000.
• 20.2% of borrowers owe between $10,000 and $20,000 in student loans.
• 18.0% owe $40,000 to $100,000.
• 5.54% owe between $100,000 and $200,000.
• 2.44% owe in excess of $200,000.
• In 2016, the average student loan payment was $393; adjusted for inflation, the average student loan payment in 2016 was equivalent of $523.
• In 2005, the average student loan payment was $227; adjusted for inflation, this is equivalent to $376.

Class of 2023 Student Loan Payments

Because student loan interest rates are at historic highs, current students may not be able to pay off their student loan debts within the recommended 10-year timeline.

• 6.53% is the interest rate for Direct Subsidized and Unsubsidized federal student loans to undergraduate borrowers.
• $62,143 is a low-end starting salary for a new graduate with a Bachelor’s degree.
• $91,411 is a high-end salary for a bachelor’s degree.
• $77,636 is the median annual salary for a recent graduate with a Bachelor’s degree.
• $23,390 is the average student debt for a federal loan borrower who graduated from a public institution with a Bachelor’s degree.
• $26,720 is the average student debt for a federal loan borrower who graduated from a private, nonprofit institution with a Bachelor’s degree.
• $34,740 is the average student debt for a federal loan borrower who graduated from a private, for profit institution with a Bachelor’s degree.

Bachelor’s Student Loan Payments

Borrowers with a bachelor’s degree benefit from increased earning potential, but student loan debt and interest rates can still create financial challenges. The ultimate cost of a bachelor’s degree depends largely on income and repayment terms.

Associate’s Student Loan Payments

Student borrowers with Associate’s degrees are the most likely to pay off their student loans faster than other degree holders. From a purely financial stand-point, this gives the average Associate’s degree the highest value in terms of cost-benefit ratio.

• Just 31% of Associate’s degree holders who graduated from public institutions use student loans to pay for school.
• 77% of attendees of private, nonprofit schools take on student loan debt.
• 91% of attendees of private, for-profit schools take on student loan debt.
• $55,016 is the median annual salary for an Associate’s degree holder.
• $36,520 is the low-end average annual salary.
• $14,890 is the average student debt for a federal loan borrower who graduated from a public institution with an associate’s degree.
• $25,770 is the average student debt for a federal loan borrower who graduated from a private, nonprofit institution with an associate’s degree.
• $24,090 is the average student debt for a federal loan borrower who graduated from a private, for profit institution with an associate’s degree.

Average Payments for Graduate Student Loans

Graduate students logically must make higher monthly payments. For some degrees, this doesn’t just mean paying a higher dollar amount; it may also mean a significant portion of a borrower’s income goes toward repaying student loan debt.

• 8.08% is the interest rate for Direct Unsubsidized federal student loans to graduate or professional borrowers.
• 9.08% is the interest rate for Direct PLUS loans, which go to graduate or professional borrowers as well as parents of undergraduates borrowing on their behalf.
• 48% of graduate degree completers have student loan debt. 54% have both undergraduate and graduate student loan debt.

Master’s Student Loan Payments

Student borrowers with Master’s degrees who make an average salary are more likely  to be able to pay 10% of their salary to pay off their loans than students with other graduate degrees.

• $58,570 is the average student debt for a borrower who graduated from a public institution with a Master’s degree.
• $77,250 is the average student debt for a borrower who graduated from a private, nonprofit institution with a Master’s degree.
• $68,590 is the average debt for Master’s degree holders who attended a private, for-profit institution.
• $90,324 is the median salary for a Master’s degree holder.
• $44,040 is the low-end salary for a Master’s degree holder.

^*NA: Monthly payments are not sufficient to cover interest payments; therefore, loan can never be repaid.

Professional & Doctorate Student Loan Payments

The average debt for a graduate from a private, nonprofit institution with a Professional degree is about the same as the average medical school debt.

• $109,668 is the median salary for people with Doctoral degrees.
• $57,490 is a low-end salary for Doctoral degree holders. 
• $71,510 is the average debt for a Doctoral degree at a public institution.
• $62,770 is the average debt for a Doctoral degree at a private, nonprofit institution.
• $123,730 is the average debt for a Doctoral degree at a private, for-profit institution.
• $178,800 is the average debt for Professional degree holders.
• $114,712 is the median annual salary for someone with a Professional degree.
• $76,530 is a low-end salary for someone with a Professional degree.

Payments for Medical School Debt

Among professional degree holders, medical and law degrees are among the most commonly sought. They are also among the most expensive.

• $199,220 is the average student loan debt for a medical school graduate.
• $60,000 is the average salary for a first-year resident.
• $239,200 is a general physician or surgeon’s salary.
• $339,470 is an anesthesiologist’s salary.

Payments for Law School Debt

The average law school debt is more than four times higher than the average undergraduate student debt but still only two-thirds of the average medical school debt. The average starting salary for a new law school graduate is similar to the average salary for someone with a bachelor’s degree.

• $140,870 is the average student loan debt for a law school graduate.
• $76,125 is the average starting salary for a law school graduate.
• $145,300 is the average salary for an experienced attorney.
• $186,350 is the average high-end salary for a senior attorney.

Private Student Loan Payments

Private student loans, for the most part, come from academic institutions as well as banks and credit unions. The total amount of private student loan debt is difficult to track because little of the related data is a matter of public record.

• 3.39% is the low-end private student loan interest rate for most student borrowers.
• 17.99% is the high-end interest rate.
• The total amount of student loan debt for private student loans is $50.9 billion.

Sources

1. Federal Reserve Board of Governors, Education Debt and Student Loans
2. BLS, Consumer Price Index Inflation Calculator
3. CNBC, Here’s How Much The Average Student Loan Borrower Owes When They Graduate
4. Opers, 50-20-30 Rule, Financial Wellness Calculator
5. Investopedia, 28/36 Rule, What It Is, How to Use It, Example
6. National Association of Colleges and Employers, Salary Survey
7. U.S. Department of Education (ED) Office of Federal Student Aid (OFSA), Standard Repayment Plan
8. ED OFSA, Federal Student Loan Portfolio
9. Washington Trust Bank, Student Loan Calculator
10. Bank Rate, Loan Calculator
11. U.S. Bureau of Labor Statistics (BLS), Employment Projections
12. National Center for Education Statistics, Digest of Education Statistics
13. FREIDA, Specialty Guide
14. U.S. News & World Report, Law School Benefits Versus Price
15. Nerd Wallet, 14 Best Private Student Loans
16. One Wisconsin Now, Twenty to Life, Higher Education Turning Into Multi-Decade Debt Sentence
17. Enterval Private Student Loan Report