The Average Student Loan Payment Is $383: Pay Off Your Debt Faster

Kat Tretina

When it comes to paying for college, federal student loans are often a student’s first choice thanks to their low interest rates and valuable repayment benefits. Unfortunately, most federal loans have strict limits on how much can be borrowed, so you may have also taken out private student loans to finish paying for your degree.

According to Saving for College, two-thirds of bachelor’s degree recipients graduated from college with student loan debt in 2019, with an average balance of $29,900. While the majority of students relied on federal student loans to pay for school, 11% took out private student loans on top of federal aid, and about 6% exclusively used private loans to finance their education. 

When those graduates started repaying their loans, the average private student loan debt payment was $383 per month.

Are you part of the 11% of graduates with private student loans?

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Private student loans aren’t eligible for income-driven repayment plans or other flexible repayment options like federal loans. If you’re sick of paying that amount every month and want to learn how to pay off student loans faster, here’s what you need to know about managing your debt. 

How to pay off student loans faster

If you want to get rid of your student loan debt ahead of schedule, there are two core strategies: making larger payments and student loan refinancing.

1. Make larger monthly payments

To speed up your debt repayment, you can pay more than the minimum required payment each month. When you pay more than the minimum, more of your payments go toward the loan principal rather than the interest that accrues on your debt. Over time, you cut down on interest charges, saving both time and money.

You can make lump-sum payments — meaning you pay a large chunk all at once — or you can increase your monthly payments by a set amount. How much of a difference could extra payments make? Let’s look at an example.

If you had $29,900 in student loans at 5.3% interest, your monthly payment would be $383 per month. It would take you eight years to repay your loans, and your total repayment would be $36,745.

If you increased your payment to $450 per month — a difference of just $67 — you would pay off your loans 17 months early. And, you’d repay just $35,472. You’d save $1,273 in interest charges.



  • Use extra windfalls: If you get windfalls from a tax refund, a bonus from work, or gifts, use that cash to pay down your loans.
  • Cut your expenses: While you’re paying off your loans, reduce your living expenses and eliminate extras like dining out, cable, and subscriptions to free up money for your student loan payments.
  • Pick up a second job or side gig: If possible, work a second job or a side gig during the evenings or on the weekends. You could work at a coffee shop, retail store, deliver groceries, or even walk dogs for additional income.
  • Sell unused stuff: If you have unused electronics, books, clothes, or accessories in your home, sell them on eBayPoshmark, or DeCluttr for cash.

2. Refinance your student loans

If you want to pay off your loans faster, another tried-and-true option is to refinance your student loans.

With this strategy, you apply for a loan with a private lender for the amount of your existing debt. The new loan will have different terms, including interest rate, monthly payment, and loan length. Depending on your credit, you may qualify for a loan with a lower interest rate to save money.

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To ditch debt quickly, it makes sense to opt for a shorter loan term than you currently have. In general, shorter loan terms qualify for the lowest interest rates. While you’ll have a higher monthly payment with a shorter term, you’ll save more money over the length of your repayment term. Ultimately, you’ll be out of debt much sooner while paying less total interest.

What if you can’t afford to increase your payments? If you’re wondering how to lower your student loan payment without having to lengthen your loan term, refinancing your private student loans can be a smart solution. By reducing your interest rate, you can lower your payment but keep to the same repayment schedule. 

Read More: Should You Refinance Private Student Loans?

For example, if you refinanced the same loans as mentioned above and qualified for an eight-year loan at 3.5% interest, your monthly payment would drop to $358 — a savings of $25 per month. Over the length of your repayment term, you’d repay just $34,324.

Even with a smaller monthly payment, you’d pay off with your loan within eight years and save $2,421 in interest charges.

  Original Loan Refinanced Loan
Loan Balance $29,900 $29,900
Loan Term 8 Years 8 Years
Interest Rate 5.3% 3.5%
Monthly Payment $383 $358
Total Interest $6,845 $4,424
Total Repaid $36,745 $34,324

Why are student loan refinancing rates so low right now?

Private lenders, including student loan refinancing lenders, typically base their interest rates on the London Interbank Offered Rate (LIBOR) or Federal Reserve rates. When these rates go down — as they have done in the past few months — private lenders decrease their rates, as well.

When the economy is in decline, those LIBOR and Fed Rates often go down, and private loan rates along with them. For borrowers wondering how to get a lower student loan payment or lower interest rate, it’s an excellent time to refinance their loans to take advantage of low rates.

Read More: Why Student Loan Refinance Rates Are Insanely Low Right Now

You can use Purefy’s Compare Rates tool to get quotes from top student loan refinancing lenders at the same time with one fast form — with no impact to your credit score.

If you have any questions during the refinancing process, you can also contact our team of award-winning loan advisors or schedule a free student loan refinance consultation.

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ELFI Rate Disclosure

4 ELFI Rate Disclosure:

Education Loan Finance is a nationwide student loan debt consolidation and refinance program offered by Tennessee based SouthEast Bank. ELFI is designed to assist borrowers through consolidating and refinancing loans into one single loan that effectively lowers your cost of education debt and/or makes repayment very simple. Subject to credit approval. See Terms & Conditions. Interest rates current as of 01/01/2023. The interest rate and monthly payment for a variable rate loan may increase after closing, but will never exceed 9.95% APR. Interest rates may be different from the rates shown above and will be based on the term of your loan, your financial history, and other factors, including your cosigner’s (if any) financial history. For example, a 10-year loan with a fixed rate of 6% would have 120 payments of $11.00 per $1,000 borrowed. Rates are subject to change.

SoFi Rate Disclosure

3 SoFi Rate Disclosure:

Fixed rates range from 4.49% APR to 8.99% APR with a 0.25% autopay discount. Variable rates from 5.09% APR to 8.99% APR with a 0.25% autopay discount. Unless required to be lower to comply with applicable law, Variable Interest rates on 5-, 7-, and 10-year terms are capped at 8.95% APR; 15- and 20-year terms are capped at 9.95% APR. Your actual rate will be within the range of rates listed above and will depend on the term you select, evaluation of your creditworthiness, income, presence of a co-signer and a variety of other factors. Lowest rates reserved for the most creditworthy borrowers. For the SoFi variable-rate product, the variable interest rate for a given month is derived by adding a margin to the 30-day average SOFR index, published two business days preceding such calendar month, rounded up to the nearest one hundredth of one percent (0.01% or 0.0001). APRs for variable-rate loans may increase after origination if the SOFR index increases. The SoFi 0.25% autopay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. This benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. The benefit lowers your interest rate but does not change the amount of your monthly payment. This benefit is suspended during periods of deferment and forbearance. Autopay is not required to receive a loan from SoFi.

Earnest Rate Disclosure

2 Earnest Rate Disclosure:

Actual rate and available repayment terms will vary based on your income. Fixed rates range from 4.72% APR to 9.24% APR (excludes 0.25% Auto Pay discount). Variable rates range from 4.39% APR to 9.19% APR (excludes 0.25% Auto Pay discount). Earnest variable interest rate student loan refinance loans are based on a publicly available index, the 30-day Average Secured Overnight Financing Rate (SOFR) published by the Federal Reserve Bank of New York. The variable rate is based on the rate published on the 25th day, or the next business day, of the preceding calendar month, rounded to the nearest hundredth of a percent. The rate will not increase more than once per month. The maximum rate for your loan is 8.95% if your loan term is 10 years or less. For loan terms of more than 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95%. Please note, we are not able to offer variable rate loans in AK, IL, MN, NH, OH, TN, and TX. Our lowest rates are only available for our most credit qualified borrowers and contain our .25% auto pay discount from a checking or savings account.

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ISL Rate Disclosure

5 Iowa Student Loan Rate Disclosure:

Fixed Rate Loan Terms: 5 years/60 monthly payments, 7 years/84 monthly payments, 10 years/120 monthly payments, 15 years/180 monthly payments, or 20 years/240 monthly payments. Annual Percentage Rate [APR] is the cost of credit calculating the interest rate, loan amount, repayment term and the timing of payments. This rate is expressed as an APR. Fixed APRs range from 6.94% to 11.58% APR [low to high range with 0.25% auto-debit rate reduction]. Rates are subject to change without notice. Fixed rates will not change during the term. Since there are no fees associated with this loan offer, the APR is the same percentage as the actual interest rate of the loan including a 0.25% auto-debit rate reduction. These rates are subject to additional terms and conditions, and rates are subject to change at any time without notice. All estimates are based on information provided by you and are for informational purposes only, accuracy is not guaranteed and may not reflect actual rates or savings and do not constitute an offer of credit. Your actual rate, payment and savings may be different based on credit history, actual interest rate, loan amount, and term, including your cosigner [if applicable]. If applying with a cosigner, we use the higher credit score between the borrower and the cosigner for approval purposes. All loans are subject to credit approval.

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