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Student Loan-
How much do you end up paying for the loan if you just pay the minimum each morth?

Ask by Clarke Reeves. in the United States
Jan 24,2025

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If you only make the minimum monthly payments on a student loan, you’ll pay more over time due to accumulated interest. For example, a $30,000 loan at 5% interest over 10 years would cost about $38,160 total, including $8,160 in interest. Extending the term to 25 years would increase the total repayment to around $52,500, with $22,500 in interest. To reduce the total amount paid, consider paying more than the minimum, refinancing for a lower interest rate, or choosing a shorter repayment term.

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If you stick to just making the minimum payments on your student loan, you’ll likely end up paying significantly more than the original amount borrowed due to accruing interest over time. For example, a $30,000 loan at a 5% interest rate could take over 10 years to pay off while costing you around $7,000 extra in interest alone! So, while minimum payments can keep you afloat, they can also lead to a long financial journey!
To avoid spending a fortune, it’s wise to tackle your student loans as aggressively as possible. Make small extra payments whenever you can, even if it’s just a little bit beyond the minimum. This approach not only reduces the principal faster, but it also decreases the total interest paid. Plus, the earlier you pay off the loan, the earlier you can start saving for other exciting adventures!

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