- Is it worth overpaying a student loan?
- It depends on the rate. Student loans are often cheap enough that money put toward a higher-rate debt, or into a pension or index fund, does more good. Run the number here, then compare it against what else that money could do before committing.
- How does a low interest rate change the maths?
- At a low rate, most of each payment already goes to the principal, so overpaying shortens the term but saves relatively little interest. At a high rate, the opposite is true and overpaying is one of the best guaranteed returns available to you.
- Should I pay off my student loan before saving?
- Not usually before an emergency buffer exists. A cleared loan is not money you can reach if the car breaks. Most guidance is to build a small cash cushion first, then attack debt by interest rate, highest first.
- Does this calculator handle income-based repayment plans?
- No. It models a fixed monthly payment against a fixed rate. Income-linked plans where repayments rise and fall with earnings, or where a balance is written off after a set period, need different maths and are not covered here.