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The 7 Payment Plan Options

Paying off your debt can seem like a never ending battle. I compare it to walking up an escalator in the wrong direction, you see where you are going, but you feel like you will never get there. Some people feel like they are the only ones dealing with huge amounts of debt, but that’s not true.  Currently American’s have over 1.3 trillion dollars in student loan debt.  Do you know how long it would take for one person to count to a trillion? It takes 31,709 years to count to a trillion if you counted every second.  The good news is there are solutions.  There are seven main payment options that allow a borrower to pay back his or her student loans:
  • Standard
  •  Extended
  • Graduated
  •  IBR
  • ICR
  • ICR-A 
  •  Pay as you earn


 The first three methods are probably vaguely familiar, but the last four may be foreign to most. The Standard method of payment is just that, you make standard payments of interest and principle generally over a 10 year time frame.  Extended is when they extend the term to a 20 or 25 year term based on the balance.  Graduated is when you start off making interest only payments for the first two years and then go to a standard plan.  IBR is a payment plan essentially based on your income.  ICRand ICR-A are similar plans contingent on income.  The pay-as-you-earn plan is similar to IBR and the ICR plans, but is contingent on when you took out your loans.
An example of an IBR plan is if you have a student loan balance of $100,000 with rates of about 6.8%.  You have a family size of one and an income of $40,000.  With a standard plan your payments would be $1150 per month.  The IBR payment for this account is $297 per month.  That is a huge difference from $1150 down to $297.  Even if this same person made $75K a year his/her IBR payment is reduced down to $734.  Yet no one seems to know this program exists and when they do they have no idea how to qualify for it. This person also may not know they qualify for forgiveness of the balance of the loans.
There is help out there and you can get out of debt whether it be student loan debt, credit card debt or any other debt you have been unable to handle.
But first you must:
  • Recognize you need help
  •  Know that there is help
  •  Seek out that help
  • Be an active participant in the change you want to see



For more information on the 7 payment plan options and loan forgiveness please visit for a free 15 minute consultation to discuss your debt.