This calculator helps you understand the potential savings and impact of adjusting your student loan payments. Many student loan repayment plans allow you to pay more than the minimum required. By increasing your monthly payment, you can significantly reduce the total interest paid over the life of the loan and pay it off sooner.
How the Calculation Works:
The calculator estimates how much faster you could pay off your loan and how much interest you might save by increasing your monthly payment. The core of the calculation involves simulating loan amortization with a higher payment.
Loan Balance: The total amount you owe on your student loans.
Annual Interest Rate: The yearly percentage charged on your outstanding balance. This is converted to a monthly rate for calculations.
Current Monthly Payment: Your current regular payment towards the loan.
Desired Monthly Payment: The increased payment you are considering.
The calculator determines the payoff time and total interest paid for both your Current Monthly Payment and your Desired Monthly Payment. The difference in total interest paid is your estimated savings.
Formula Basis (Simplified):
While actual amortization involves complex iterative calculations, the underlying principle for determining loan payoff time (N) with a fixed payment (P), principal (L), and monthly interest rate (r) is often derived from the loan payment formula:
P = L * [r(1+r)^N] / [(1+r)^N - 1]
This formula can be rearranged to solve for N (number of periods/months). The calculator iterates this process for both payment scenarios to compare the total interest paid.
Total Interest Paid = (Total Number of Payments * Monthly Payment) – Original Loan Balance
Use Cases:
Accelerated Payoff: See how much sooner you can be debt-free by paying extra.
Interest Savings: Quantify the amount of interest you can save by increasing your payments.
Budget Planning: Determine if an increased payment fits within your budget and what the benefits are.
Debt Reduction Strategy: Use this tool to reinforce motivation for aggressive debt repayment.
By inputting your loan details, you can gain valuable insights into optimizing your student loan repayment strategy and achieving financial freedom faster.
function calculateSavePlan() {
var totalLoanBalance = parseFloat(document.getElementById("totalLoanBalance").value);
var interestRate = parseFloat(document.getElementById("interestRate").value);
var monthlyPaymentCurrent = parseFloat(document.getElementById("monthlyPayment").value);
var monthlyPaymentTarget = parseFloat(document.getElementById("targetPayment").value);
var resultDiv = document.getElementById("result");
var resultValueDiv = document.getElementById("result-value");
var resultDetailsP = document.getElementById("result-details");
// Clear previous results
resultDiv.style.display = "none";
resultValueDiv.textContent = "";
resultDetailsP.textContent = "";
// Input validation
if (isNaN(totalLoanBalance) || isNaN(interestRate) || isNaN(monthlyPaymentCurrent) || isNaN(monthlyPaymentTarget) ||
totalLoanBalance <= 0 || interestRate < 0 || monthlyPaymentCurrent <= 0 || monthlyPaymentTarget <= 0) {
alert("Please enter valid positive numbers for all fields.");
return;
}
if (monthlyPaymentTarget <= monthlyPaymentCurrent) {
alert("Your Desired Monthly Payment must be greater than your Current Monthly Payment to see savings.");
return;
}
var monthlyInterestRate = interestRate / 100 / 12;
// Function to calculate loan payoff details
function calculateLoanDetails(principal, annualRate, payment) {
var monthlyRate = annualRate / 100 / 12;
var numMonths = 0;
var totalInterestPaid = 0;
var balance = principal;
var tempPrincipal = principal; // Use a temporary variable for calculation
// Handle case where payment is too low to cover interest
if (payment 0) {
var interestThisMonth = balance * monthlyRate;
var principalThisMonth = payment – interestThisMonth;
// Ensure principal payment doesn't exceed remaining balance + interest
if (principalThisMonth > balance) {
principalThisMonth = balance;
payment = principalThisMonth + interestThisMonth; // Adjust last payment
}
balance -= principalThisMonth;
totalInterestPaid += interestThisMonth;
numMonths++;
if (numMonths > 10000) { // Prevent infinite loop for very large loans or low payments
return { numMonths: Infinity, totalInterestPaid: Infinity };
}
}
// Recalculate total interest based on actual payments made
totalInterestPaid = (numMonths * payment) – tempPrincipal;
return { numMonths: numMonths, totalInterestPaid: totalInterestPaid };
}
// Calculate for current payment
var currentDetails = calculateLoanDetails(totalLoanBalance, interestRate, monthlyPaymentCurrent);
var currentPayoffYears = currentDetails.numMonths === Infinity ? "N/A" : Math.floor(currentDetails.numMonths / 12) + " years " + (currentDetails.numMonths % 12) + " months";
var currentTotalInterest = currentDetails.numMonths === Infinity ? "N/A" : currentDetails.totalInterestPaid.toFixed(2);
// Calculate for target payment
var targetDetails = calculateLoanDetails(totalLoanBalance, interestRate, monthlyPaymentTarget);
var targetPayoffYears = targetDetails.numMonths === Infinity ? "N/A" : Math.floor(targetDetails.numMonths / 12) + " years " + (targetDetails.numMonths % 12) + " months";
var targetTotalInterest = targetDetails.numMonths === Infinity ? "N/A" : targetDetails.totalInterestPaid.toFixed(2);
var interestSavings = "N/A";
if (currentTotalInterest !== "N/A" && targetTotalInterest !== "N/A") {
interestSavings = (currentTotalInterest – targetTotalInterest).toFixed(2);
}
var timeSaved = "N/A";
if (currentDetails.numMonths !== Infinity && targetDetails.numMonths !== Infinity) {
var monthsSaved = currentDetails.numMonths – targetDetails.numMonths;
timeSaved = Math.floor(monthsSaved / 12) + " years " + (monthsSaved % 12) + " months";
}
resultDiv.style.display = "block";
resultValueDiv.textContent = "$" + interestSavings;
resultDetailsP.innerHTML = `
With your Desired Monthly Payment of $${monthlyPaymentTarget.toFixed(2)}:
Estimated payoff time: ${targetPayoffYears}
Estimated total interest paid: $${targetTotalInterest}
Compared to your Current Monthly Payment of $${monthlyPaymentCurrent.toFixed(2)}:
Estimated payoff time: ${currentPayoffYears}
Estimated total interest paid: $${currentTotalInterest}
You could save approximately $${interestSavings} in interest and pay off your loan ${timeSaved} sooner!
`;
}