SAVE is gone. Here are the five repayment paths borrowers are choosing instead
Borrowers who were on the SAVE plan have had to pick a new repayment path, and the options are not identical in cost or in the protections they carry. We ran the numbers on the remaining plans across three income profiles to see how the monthly payment and total cost actually compare.
The federal loan servicer options that remain differ mainly in how the monthly payment is calculated and how long forgiveness of any remaining balance takes. Standard repayment sets a fixed payment over 10 years and is the fastest way to be debt-free, at the cost of the highest monthly bill. The remaining income-driven plans cap payments at a share of discretionary income and extend the forgiveness timeline to 20 or 25 years, trading a lower monthly payment for a longer commitment and, depending on current tax law, a potential tax bill on any amount forgiven at the end.
For a borrower early in a lower-paying career, an income-driven plan usually keeps the monthly payment more manageable relative to take-home pay, even though the total interest paid over the life of the loan runs higher than standard repayment. For a borrower with a income that has grown substantially since graduation, standard repayment often becomes the cheaper path in total cost, because an income-driven payment calculated on today's higher income may not be meaningfully lower than the standard payment anyway.
The detail that trips people up moving off SAVE is recertification. Every income-driven plan requires annual recertification of income and family size — miss the deadline and your servicer can automatically bump you to a higher payment calculated as if you had no documented income adjustment, or move you off the plan and into standard repayment without warning. Set a calendar reminder well ahead of your recertification date, not on it.
If you are choosing a plan for the first time or comparing yours against standard repayment, run your actual balance, rate, and income scenario through the loan calculator below rather than relying on rules of thumb — the crossover point where standard repayment becomes cheaper than an income-driven plan depends heavily on your specific rate and how much your income is likely to grow.