Step 3: Borrow Smart

Student Loan Repayment Affordability Guidelines

Monthly minimum payment for total student loan debt should be 10% or less of your expected monthly take-home pay. Approximate take-home pay to be about 75% of salary. Use Salary Information Tools and Student Loan Calculators below to get an idea about your recommended loan limit.

Annually assess total loan debt for repayment affordability.

  • Gather totals for all student loans
    • Federal:
    • Private: See your lender’s customer portal
  • Use loan simulator, like those linked below, to simulate future borrowing
  • Check monthly minimum loan repayment amount against anticipated future earnings

Salary Information Tools

  • MU Career Center: Staff can show you how to find salary information from trusted sources.
  • College Career Services Office: Find salary data for recent graduates in your program of study.
  • Median Salaries by Occupation and Location, Bureau of Labor Statistics

Student Loan Calculators

Federal Student Aid Loan Simulator
Mapping Your Future Debt/Salary Wizard
Buyer Beware: College Major ROI

More Smart Borrowing Tips

  1. Borrow proactively to avoid overborrowing
    • Assess loan needs each spring. Visit OFS if unsure how much you will need to cover educational expenses.
  2. Got a refund from MU due to a loan?
    • Divide refund by # months in the semester. ‘Pay yourself’ that amount monthly to cover living expenses.
    • Set your TouchNet account so that refunds are credited toward future semesters
    • Apply refund toward loan repayment
    • Reassess borrowing needs – Take out smaller loan next term
    • Don’t fund wants (spring break or new car down payment) with student loan
  3. If possible, pay the interest on unsubsidized and private loans while in school or before repayment begins
    • For a $5,500 loan at 5.5% interest, paying off interest monthly amounts to about $25 a month.
    • Paying off accrued interest while in school will reduce total debt and monthly repayment amount at graduation.