Total Student Loan Forgiveness Estimator

What Is a Total Student Loan Forgiveness Estimator?

A Total Student Loan Forgiveness Estimator is an online calculator that projects:

• Estimated monthly payments under an income-driven repayment plan
• Remaining balance at the time of forgiveness
• Total amount forgiven
• Total amount paid over time

It is designed for borrowers pursuing:

• Public Service Loan Forgiveness (PSLF)
• Standard Income-Driven Repayment (IDR) forgiveness (20–25 years)

The estimator uses your income, loan balance, interest rate, family size, and loan type mix to simulate what happens over time.

It does not guarantee results. It provides a realistic projection based on current rules and steady income.

Forgiveness Programs Covered by the Estimator

1. Public Service Loan Forgiveness (PSLF)

Public Service Loan Forgiveness

PSLF forgives remaining federal student loan debt after 120 qualifying payments while working full-time for a qualifying employer.

Key facts:

• Requires 10 years (120 payments)
• Must work for government or qualifying nonprofit
• Forgiven amount is federally tax-free
• Must be on an income-driven repayment plan

If you qualify, PSLF often results in the largest forgiveness amount.

2. Income-Driven Repayment (IDR) Forgiveness

Income-Driven Repayment

IDR plans forgive remaining balances after:

• 20 years (240 payments) for undergraduate loans
• 25 years (300 payments) if you have any graduate loans

Forgiveness under standard IDR may be treated as taxable income at the federal level after 2025.

This is sometimes called the “tax bomb.”

How the Estimator Calculates Your Payment

The estimator follows four core steps.

Step 1: Determine Forgiveness Timeline

• PSLF → 120 total payments
• IDR → 240 or 300 payments depending on graduate loans

If you’ve already made qualifying payments, those are subtracted from the total.

Step 2: Calculate Discretionary Income

The estimator uses:

• Your Adjusted Gross Income (AGI)
• Your family size
• Your state (48 states/DC, Alaska, or Hawaii)

It applies the 225% federal poverty guideline rule used under the SAVE plan.

Discretionary income =
AGI – 225% of poverty guideline

If that number is negative, your payment is set to $0.

Step 3: Apply the Weighted Payment Rate

The estimator accounts for loan type mix:

• Undergraduate loans → 5% of discretionary income
• Graduate loans → 10% of discretionary income

If you have both, it calculates a weighted average.

For example:

• 70% undergrad + 30% grad
• Payment rate = (0.70 × 5%) + (0.30 × 10%)

This ensures accuracy.

Step 4: Simulate Monthly Payments

The estimator then runs a month-by-month simulation:

• Interest accrues monthly
• Your payment is applied
• If payment is less than interest, unpaid interest does not grow your principal under the SAVE subsidy
• Balance declines only if payment exceeds interest

At the end of the forgiveness timeline:

• Remaining balance = Forgiven amount
• Total paid = Your out-of-pocket cost

If your payment is high enough to pay off the loan early, forgiveness will not occur.

The calculator flags that situation clearly.

What Inputs You Need

To use a Total Student Loan Forgiveness Estimator correctly, gather:

1. Current loan balance
2. Average interest rate
3. Number of qualifying payments already made
4. Adjusted Gross Income (AGI)
5. Family size
6. State of residence
7. Loan mix (undergrad vs graduate)

The more accurate your inputs, the more realistic your projection.

What the Results Mean

After running the estimator, you’ll see:

Projected Total Forgiveness

The estimated balance that could be wiped away.

Estimated Monthly Payment

Your projected SAVE plan payment.

Total Out-of-Pocket

How much you will pay from today until forgiveness or payoff.

Early Payoff Warning

If your income is high enough, your loan may be fully repaid before forgiveness.

Tax Warning (IDR Only)

Standard IDR forgiveness may create taxable income.

PSLF does not.

Example Scenario

Let’s say:

• Loan balance: $80,000
• Interest rate: 6%
• AGI: $65,000
• Family size: 1
• 100% graduate loans
• Pursuing PSLF

The estimator might show:

• Monthly payment: $250–$350 range
• Total paid over 10 years: ~$30,000–$40,000
• Forgiven amount: ~$50,000+

This gives clarity. You can now compare staying in public service versus switching careers.

Why a Forgiveness Estimator Matters

Student loan repayment is not one-size-fits-all.

Some borrowers should:

• Maximize forgiveness
• Lower AGI strategically
• Stay in PSLF employment

Others may:

• Earn too much to benefit from forgiveness
• Pay loans off faster
• Refinance privately

An estimator helps you see which path makes financial sense.

Without it, you’re guessing.

Limitations to Understand

A forgiveness estimator assumes:

• Income remains steady
• Family size does not change
• Federal policies stay consistent
• You recertify income annually

Real life changes things:

• Salary increases
• Marriage
• Job changes
• Legislative updates

Use the estimator as a planning tool, not a guarantee.

Who Should Use a Total Student Loan Forgiveness Estimator?

This tool is ideal for:

• Public service workers
• Teachers
• Nurses
• Government employees
• Social workers
• Graduate degree holders with high balances
• Anyone on the SAVE or IDR plan

If you owe more than you earn annually, forgiveness projections are especially important.

Common Mistakes to Avoid

1. Overestimating forgiveness without accounting for rising income
2. Ignoring tax implications under IDR
3. Forgetting to count qualifying payments already made
4. Assuming all employers qualify for PSLF
5. Not updating estimates yearly

Re-run projections every year.