What is effective interest rate and how do I calculate it for SAVE Plan?

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• 
  Abbey Johnson
  

  Helping with Student Loan Documentation .
  Should I consider consolidating my federal student loans, which have varying interest rates ranging from 2.5% to 5.05%, now that the grace period is ending and interest rates are starting up again? I've also heard about different repayment plans on FAFSA, like the SAVE plan, but I'm not sure how they work. What would be the best approach for paying off my total student loan debt of $60,000, with $30,000 each from Federal and Private, considering my private loan interest rate is 5.64%?
  FAFSA is the Free Application for Federal Student Aid and it is the thing you fill out to get ...
  
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• 
  Abbey Johnson
  

  Helping with Student Loan Documentation .
  If my initial loan balance was above $27,000 and now it’s $12,000, will my forgiveness period be 10 years now for SAVE Plan of Student loan?
  No, your repayment period is only based on your initial balance.
  
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• 
  Abbey Johnson
  

  Helping with Student Loan Documentation .
  Why does the loan consolidation for my $98,000 in graduate loans under SAVE result in a total payment of $198,000 over 25 years, doubling the loan amount, despite my understanding that interest would be waived? Is there something I'm overlooking compared to PAYE and IBR plans, which calculate a total payment of $167,000?
  98000 at an example 6% interest, accrues approximately $490 a month in interest. If you pay $436, they waive ...
  
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• 
  Abbey Johnson
  

  Helping with Student Loan Documentation .
  How to calculate SAVE Plan payment for Student Loan?
  For anyone having trouble calculating their estimated SAVE plan payment. Monthly SAVE plan payment equals: (AGI - (2.25*PL)) X (0.1/12) If you ...
  
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• 
  Abbey Johnson
  

  Helping with Student Loan Documentation .
  I’m confused how the SAVE plan  of Student loan works. I thought there was no interest that accrues. Can anyone share their knowledge?
    Interest still accrues on the SAVE plan, but if the amount of interest that accrues is greater than your ...
  
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• 
  Abbey Johnson
  

  Helping with Student Loan Documentation .
  What if my spouse and I both have loans, would we pay 20% of our discretionary income instead of 10% for SAVE Plan of Student loan?
  No, the calculation should be the same (student loan servicer's may make errors here so check their math). However, the ...
  
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• 
  Abbey Johnson
  

  Helping with Student Loan Documentation .
  How do I calculate my monthly accruing interest for SAVE Plan of Student loan?
  Principal Loan Balance * Interest Rate / 12. You can also refer to this for detailed SAVE Plan payment calculation.  
  
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• 
  Abbey Johnson
  

  Helping with Student Loan Documentation .
  Do I get any benefit on the SAVE Plan of Student loan if my income will increase next year such that I won’t receive an interest subsidy?
  Yes, you still may get an interest subsidy this year which will lower the repayment amount this year, your ...
  
  1 0 0
• 
  Abbey Johnson
  

  Helping with Student Loan Documentation .
  How can I reduce my AGI without reducing my gross income for SAVE Plan of Student loan?
  You can obtain more “above the line” deductions by contributing more to your 401k, tax deductible IRA, and health ...
  
  1 0 0
• 
  Abbey Johnson
  

  Helping with Student Loan Documentation .
  What if I lose my job or my pay decreases while in SAVE Plan of Student loan?
  You can let your servicer or studentaid.gov know of such a decrease and your payment will be recalculated.
  
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• 
  Abbey Johnson
  

  Helping with Student Loan Documentation .
  What if my income increases, do I need to report that in SAVE Plan of Student loan?
  No. You don’t have to report any changes in your income. Income recertification occurs once per year, and you ...
  
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• 
  Abbey Johnson
  

  Helping with Student Loan Documentation .
  Does it ever make sense to take a lower paying job so that I pay less in SAVE Plan of Student loan?
  No, since you only pay 10% of each additional dollar your earn, you'd receive an additional 90% of each ...
  
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• 
  Abbey Johnson
  

  Helping with Student Loan Documentation .
  In SAVE Plan, how many years before my student loans are forgiven?
  20 years for solely undergrad loans with initial balances above $22,000. 25 years for grad only loans or grad ...
  
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