Paye Vs Save Calculator

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PAYE vs SAVE Calculator

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Student loans can be overwhelming, and choosing the right repayment plan is critical to managing debt efficiently. The PAYE vs SAVE Calculator is a powerful online tool that allows you to compare Pay As You Earn (PAYE) and Saving on a Valuable Education (SAVE) plans to find the best option for your financial situation.

This tool simplifies complex calculations, helps project long-term payments, and highlights potential loan forgiveness. Whether you’re an undergraduate, graduate, or professional student, understanding your repayment options can save you thousands over the life of your loan.

What Is the PAYE vs SAVE Calculator?

The PAYE vs SAVE Calculator is an interactive web tool that allows students and borrowers to input their loan balance, annual income, family size, state of residence, loan type, interest rate, and spouse income.

Once you enter your information, the calculator instantly provides a detailed comparison between:

  • PAYE (Pay As You Earn) – Typically limits payments to 10% of discretionary income with forgiveness after 20 years.
  • SAVE (Saving on a Valuable Education) – A newer, flexible repayment plan with potentially lower monthly payments based on income and family size.

The calculator also produces a comparison summary, highlighting recommended plans, monthly differences, total savings, and the percentage of income spent on loan payments.

Key Features of the PAYE vs SAVE Calculator

  1. Comprehensive Loan Comparison: View PAYE and SAVE side by side.
  2. Monthly Payment Estimates: Know exactly how much you’ll pay each month.
  3. Total Payment Over Time: Estimate payments over the full repayment period.
  4. Forgiveness Projection: See how much of your loan may be forgiven under each plan.
  5. Personalized Results: Adjust for income, family size, state, loan type, and spouse income.
  6. Easy-to-Use Interface: Input data and get results instantly.
  7. Clear Comparison Summary: Identify the plan that best suits your financial goals.

How to Use the PAYE vs SAVE Calculator

1. Enter Your Student Loan Balance

Input the total amount you owe. This can include federal undergraduate, graduate, or a combination of loans.

2. Provide Your Annual Income

Include your salary and any spouse income if married.

3. Select Your Family Size

Family size affects your discretionary income, which in turn affects monthly payments.

4. Choose State of Residence

Different states have different poverty guidelines, which are used to calculate discretionary income.

5. Select Loan Type

Choose whether your loan is Undergraduate Only, Graduate/Professional Only, or Mixed.

6. Enter Interest Rate

Input the average interest rate of your student loans to project long-term payments accurately.

7. Click Calculate

The calculator will display:

  • PAYE Plan: Monthly payment, total paid over 20 years, and forgiveness.
  • SAVE Plan: Monthly payment, total paid, forgiveness, and repayment period.
  • Comparison Summary: Recommended plan, monthly difference, total savings, and payment as a percentage of income.

8. Reset for New Calculation

Click Reset to start a new comparison.

Example of PAYE vs SAVE Calculation

Scenario:

  • Loan Balance: $50,000
  • Annual Income: $60,000
  • Family Size: 1
  • State: Contiguous US
  • Loan Type: Graduate Only
  • Interest Rate: 5%

Results:

  • PAYE:
    • Monthly Payment: $350
    • Total Paid: $84,000
    • Forgiven Amount: $15,000
  • SAVE:
    • Monthly Payment: $300
    • Total Paid: $78,000
    • Forgiven Amount: $22,000
    • Repayment Period: 25 years

Comparison Summary:

  • Recommended Plan: SAVE (Lower Monthly Payment)
  • Monthly Difference: $50
  • Total Savings: $6,000 (SAVE)
  • Annual Payment % of Income: 6%

Benefits of Using the PAYE vs SAVE Calculator

  1. Simplifies Complex Calculations: No need to manually estimate payments or forgiveness.
  2. Informed Decision Making: Helps identify the repayment plan that minimizes financial strain.
  3. Maximizes Loan Forgiveness: Visualize potential amounts forgiven under each plan.
  4. Personalized for Your Situation: Factors in income, family size, state, loan type, and spouse income.
  5. Time-Saving: Get instant, accurate comparisons in minutes.
  6. Financial Planning Tool: Ideal for budgeting and long-term financial planning.

15 Frequently Asked Questions (FAQs)

1. What is the PAYE vs SAVE Calculator?
A tool to compare federal student loan repayment plans—PAYE and SAVE—based on your income and loan balance.

2. Are PAYE and SAVE the same?
No. PAYE caps payments at 10% of discretionary income, while SAVE adjusts payments with potential lower monthly payments based on family size and loan type.

3. Can I use this for both undergraduate and graduate loans?
Yes, the calculator allows input for undergraduate, graduate, or mixed loans.

4. How accurate are the calculations?
Very accurate; the tool uses federal formulas for discretionary income, interest, and repayment projections.

5. Does it consider spouse income?
Yes, spouse income is included if married, affecting discretionary income and payments.

6. Can it calculate forgiveness?
Yes, it estimates amounts forgiven after the standard repayment periods (20–25 years).

7. What is discretionary income?
Discretionary income is the amount of income above 150% of the poverty guideline (PAYE) or 225% (SAVE).

8. Can I use this calculator for Alaska or Hawaii?
Yes, it adjusts poverty guidelines based on state.

9. Is it free to use?
Yes, completely free and web-based.

10. Can I see total savings between plans?
Yes, the comparison summary highlights total savings and the recommended plan.

11. What if my loan balance is zero or negative?
The calculator requires a positive loan balance to function correctly.

12. Does it account for interest rates?
Yes, input your average interest rate for accurate projections.

13. Can I reset the inputs?
Yes, click the Reset button to start a new calculation.

14. What repayment period does SAVE use?
SAVE repayment period varies based on loan type and balance, generally 10–25 years.

15. Can this help me budget my monthly payments?
Absolutely, it provides clear monthly payment amounts for both plans to help with financial planning.

Conclusion

The PAYE vs SAVE Calculator is an essential tool for student loan borrowers who want to make informed repayment decisions. By comparing monthly payments, total costs, forgiveness, and repayment periods, you can determine which plan minimizes financial strain and maximizes loan forgiveness.

Use this calculator today to take control of your student loans, plan your budget effectively, and choose the repayment plan that fits your lifestyle and financial goals.

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