Your repayment plan decides two things: what you pay each month, and whether anything is left to forgive at the end. Pick the wrong one and you can pay hundreds more a month than you need to, or lose years of progress toward forgiveness.
The menu changed a lot. SAVE is gone, two new plans opened on July 1, 2026, and which plans you can use now depends on when your loans were paid out.
Here’s how each plan works, which ones you can actually use, and how to pick.
The short answer
- If all your federal loans were paid out before July 1, 2026, you can still choose Standard, Graduated, Extended, IBR, RAP, and for now PAYE and ICR.
- If you have even one Direct Loan (a consolidation loan counts) paid out on or after July 1, 2026, all of your Direct Loans go on RAP or Tiered Standard. Nothing else.
- Most people with a modest income end up choosing between RAP and IBR. Run both. The cheaper one depends on your income and family size.
- Working toward PSLF? Pick RAP, IBR or the 10-year Standard plan. Tiered Standard, Graduated and Extended payments don’t count.
- SAVE is over. If you were on it, read what former SAVE borrowers should do now.
First, figure out which plans you can use
Everything hangs on one date: July 1, 2026. Log in to StudentAid.gov, open your Dashboard and look at each loan’s type and disbursement date. You’ll land in one of three groups.
All your loans were paid out before July 1, 2026
This is most people repaying right now, and you have the most choices. The fixed plans (Standard, Graduated, Extended) stay open to you. So does IBR. You can also move to RAP if it’s cheaper. PAYE and ICR are still around too, but both close no later than July 1, 2028, so they’re a short-term stop at best.
The one plan you can’t pick is Tiered Standard, because it’s only for borrowers who have a loan paid out on or after July 1, 2026.
You have any loan paid out on or after July 1, 2026
Then you get two plans: RAP or Tiered Standard. And here’s the part that catches people. That one new loan pulls all your eligible Direct Loans, including the old ones, onto those two plans. Your older loans don’t keep IBR or the 10-year Standard plan.
You’re a parent with Parent PLUS loans
Parent PLUS loans can’t use RAP at all. Borrowed before July 1, 2026 and never consolidated? You have Standard, Graduated and Extended. If you consolidated into a Direct Consolidation Loan paid out before July 1, 2026, you can use ICR, and you can still get to IBR by making at least one ICR payment before ICR closes. A Parent PLUS consolidation made on or after July 1, 2026 gets Tiered Standard only, with no income-driven plan and no PSLF. Our Parent PLUS repayment guide walks through each path.
Before you take a new loan or consolidate
A new Direct Loan or a new consolidation loan paid out on or after July 1, 2026 moves every eligible Direct Loan you have onto RAP or Tiered Standard, and a consolidation can’t be undone. If you’re happy on IBR or the 10-year Standard plan, think hard before you consolidate. The consolidation guide covers when it still makes sense.
Every federal repayment plan, side by side
Fixed plans set your payment from your balance and rate. Income-driven plans set it from your income, and forgive what’s left after a set number of years.
| Plan | Who can use it | Monthly payment | Paid off or forgiven | Counts for PSLF? |
|---|---|---|---|---|
| Standard (10-year) | Loans paid out before July 1, 2026 | Fixed, at least $50 | Paid off in 10 years (10 to 30 for consolidation loans) | Yes, the 10-year version |
| Graduated | Loans paid out before July 1, 2026 | Starts low, usually rises every two years | Paid off in 10 years (10 to 30 for consolidation loans) | No |
| Extended | Loans paid out before July 1, 2026, and more than $30,000 in Direct Loans | Fixed or graduated | Paid off in up to 25 years | No |
| Tiered Standard | Anyone with a loan paid out on or after July 1, 2026 | Fixed, at least $50 | Paid off in 10 years under $25,000, 15 years up to $50,000, 20 years up to $100,000, 25 years at $100,000 or more | No |
| RAP (Repayment Assistance Plan) | Any Direct Loan except Parent PLUS and consolidations that repaid Parent PLUS | 1% to 10% of your AGI, divided by 12, minus $50 per dependent. Never under $10. No cap | Forgiven after 360 qualifying payments (at least 30 years) | Yes, if each payment is on time and in full |
| IBR (Income-Based Repayment) | Loans paid out before July 1, 2026, and no newer loan | 10% of discretionary income (15% if you borrowed before July 1, 2014). Capped at the 10-year Standard amount | Forgiven after 20 years (25 if you borrowed before July 1, 2014) | Yes |
| PAYE | Some pre-July 2026 borrowers. Closes no later than July 1, 2028 | 10% of discretionary income, capped at the 10-year Standard amount | Forgiven after 20 years | Yes |
| ICR | Direct Loans paid out before July 1, 2026. Closes no later than July 1, 2028 | 20% of discretionary income or a 12-year fixed amount adjusted for income, whichever is less. No cap | Forgiven after 25 years | Yes |
| SAVE | Nobody. A court ended it | None | Borrowers are being moved to other plans | SAVE forbearance months don’t count |
A few words in that table do a lot of work.
- AGI
- Adjusted gross income, the number on your federal tax return. RAP uses it straight, with no deduction for living costs.
- Discretionary income (IBR)
- Your AGI minus 150% of the federal poverty guideline for your family size and state. For one person in the lower 48 states, the 2026 guideline is $15,960, so the first $23,940 of income is left out.
- Dependent (RAP)
- Someone you claim as a dependent on your federal tax return. Each one knocks $50 off your monthly RAP payment.
- Qualifying payment
- A payment that counts toward forgiveness. Under RAP it has to be on time and in full.
RAP vs. IBR vs. Standard, worked out with real numbers
Formulas are a lot easier to judge with real numbers in them, so here’s one borrower run through each plan she can use, with the official formulas.
Example: Jordan, single, $55,000 AGI, $35,000 in Direct Loans
- RAP
- $229.17/mo
- IBR (10%)
- $258.83/mo
- Extended (25-year fixed)
- $236.32/mo
- Standard (10-year)
- $397.42/mo
Assumptions: all of Jordan’s loans were paid out before July 1, 2026, and she first borrowed after July 1, 2014 (so IBR is 10%). No dependents, lives in the lower 48, and an average interest rate of 6.5%, which is our assumption, not a quoted rate.
RAP: $55,000 falls in the $50,001 to $60,000 band, which is 5% of AGI. That’s $2,750 a year, divided by 12 is $229.17.
IBR: 150% of the $15,960 poverty guideline is $23,940. $55,000 minus $23,940 leaves $31,060 of discretionary income. 10% of that is $3,106 a year, or $258.83 a month. That’s under the 10-year Standard cap, so it stands.
Standard and Extended: the normal loan payment formula on $35,000 at 6.5%, over 120 months and 300 months.
RAP wins for Jordan by about $30 a month over IBR. And there’s a perk the table hides.
At 6.5%, roughly $189.58 of interest builds on $35,000 each month. Her $229.17 RAP payment covers that and knocks about $39.59 off principal. Since that’s under $50, the Education Department adds a matching payment of about $10.41 so her principal drops a full $50 that month. If her payment ever fell below the month’s interest, the unpaid interest would be waived instead of piling up.
Extended looks close at $236.32, but it doesn’t count for PSLF and nothing gets forgiven. The catch with RAP is the timeline. Forgiveness takes 360 payments, so 30 years, versus 20 on IBR.
Change the income and the answer flips
Same borrower, same $35,000 at 6.5%, and only the AGI moves.
| AGI (single, no kids) | RAP | IBR (10%) | Standard (10-year) |
|---|---|---|---|
| $20,000 | $16.67 | $0 | $397.42 |
| $35,000 | $87.50 | $92.17 | $397.42 |
| $55,000 | $229.17 | $258.83 | $397.42 |
| $80,000 | $466.67 | $397.42 (capped) | $397.42 |
| $110,000 | $916.67 | $397.42 (capped) | $397.42 |
See what happens at $80,000? RAP has no cap, so it climbs right past the Standard payment. IBR stops at the Standard amount. At the very bottom, IBR can be $0, while RAP never goes under $10 (it’s $16.67 at $20,000 because 1% of $20,000 is $200 a year).
Is the $0 always better? Not quite. Under IBR, interest your payment doesn’t cover keeps building on unsubsidized loans. Under RAP it’s waived each month you pay on time. Low income and a big balance? That waiver can matter more than $16 a month.
Next stepPlug in your own AGI and dependents with our RAP calculator, then check IBR against it in the official Repayment Calculator on StudentAid.gov (the tool that used to be called Loan Simulator)
How to choose, by situation
Your income is low compared to what you owe
Go income-driven.
Run RAP and IBR side by side and take the lower payment, unless your balance is growing fast, in which case RAP’s interest waiver is worth a look even at a few dollars more. If you can’t pay anything at all for a while, ask your servicer about deferment or forbearance, but know that interest usually keeps building.
You work in public service and want PSLF
You want the lowest payment that still counts, because whatever’s left after 120 qualifying payments is forgiven, and PSLF forgiveness isn’t federally taxable. That means RAP or IBR, whichever is lower. The 10-year Standard plan counts too, but you’d pay the whole thing off in those 10 years, so there’s nothing left to forgive.
Stay away from Tiered Standard, Graduated and Extended. If you have any loan paid out on or after July 1, 2026, RAP is the only plan whose payments count. On RAP, pay on time and in full every month, because a late payment doesn’t count. More in our PSLF guide.
Your income is high and you want them gone
Forgiveness probably isn’t in the cards, so the cheapest route is the one with the least interest. That’s usually the 10-year Standard plan, or Tiered Standard if you have a newer loan. Federal loans have no prepayment penalty, so you can pay extra on any plan and finish sooner.
Don’t put a high income on RAP without checking. As the table shows, RAP can cost more than Standard once your AGI is high. Our payoff calculator shows how much an extra $100 or $200 a month saves.
You have Parent PLUS loans
Standard is the cheapest if the payment fits your budget. Too high? Extended stretches it to as long as 25 years when you owe more than $30,000. Already have a Parent PLUS consolidation from before July 1, 2026? Get onto ICR and make at least one payment before ICR closes, so the loan keeps its path to IBR. Don’t open a new consolidation now unless you’ve checked what it costs you. It would land on Tiered Standard only.
You have a big balance and expect IDR forgiveness
Plan for the tax bill. IDR forgiveness from 2026 on is generally taxable federal income, and it could be taxable in your state too. A five-figure balance forgiven after 20 years can mean a real bill that year. PSLF, death and disability discharges aren’t federally taxed.
Bottom line: if your income is modest, compare RAP and IBR. If it’s high, compare Standard against paying extra. Never pick a plan just because it’s the lowest payment this month without checking where it leaves your balance.
How to switch plans
Switching is free and you can do it yourself online. Help from your servicer is free too. Never pay a company to do this.
- Log in to StudentAid.gov. Check your loan types, disbursement dates and current plan on your Dashboard under “My Loans.”
- Compare your options. Open the Repayment Calculator and log in so it pulls in your real loans and income.
- Apply. For RAP, IBR, PAYE or ICR, use the income-driven repayment application at StudentAid.gov/idr. For a fixed plan, select “Apply” on that plan in the calculator. Your servicer can help with either, for free.
- Say yes to IRS consent. Choosing “Provide Approval” lets the Education Department pull your income from the IRS, which speeds things up and turns on automatic recertification each year.
- Keep paying until it’s done. Most applications take a few weeks. Your servicer may put you in a processing forbearance for up to 60 days while it works.
- Check the new payment. Read the notice your servicer sends and make sure autopay will pull the right amount.
Two catches before you switch.
Leaving IBR adds any unpaid interest to your principal, so a balance that grew while you were on IBR gets bigger on paper the day you leave. And if you move from IBR to RAP and later go back, your RAP months don’t count toward IBR forgiveness (they do still count for PSLF).
Recertify every year, or your payment jumps
Every income-driven plan needs your income and family size (or dependents, for RAP) once a year. If you gave IRS consent, it happens on its own, starting 120 days before your recertification date. If not, submit a new application about 90 days before the date shown on your StudentAid.gov Dashboard.
Miss it and the payment stops being based on your income. On RAP, it becomes what you’d pay on the 10-year Standard plan, based on your balance when the loans entered repayment. On IBR, it goes to the Standard cap and your unpaid interest gets added to principal. If Jordan’s loans entered repayment at $35,000, that’s $397.42 instead of $229.17.
Lost your job or took a pay cut mid-year? You don’t have to wait for your recertification date, so ask for a recalculation as soon as your income drops.
Mistakes that cost borrowers the most
- Consolidating, or taking any new Direct Loan, on or after July 1, 2026 without checking first. It moves all your Direct Loans to RAP or Tiered Standard for good.
- Ignoring a servicer notice about SAVE. Do nothing and you’re placed on the Standard plan (or Tiered Standard), which may cost a lot more.
- Sitting on Tiered Standard, Graduated or Extended while you work toward PSLF. Those months don’t count.
- Putting a high income on RAP. There’s no cap, so it can cost more than Standard.
- Assuming forgiveness is tax free. Only some of it is.
- Paying a “document prep” company to enroll you. It’s free on StudentAid.gov.
Already behind on payments? Changing plans can help, but the steps are different once a loan is in default. Start with our guide to getting out of student loan default.
Student loan repayment plan FAQs
There isn’t one best plan. With a modest income, compare RAP and IBR and take the lower payment. Working toward PSLF? Use the lowest payment that counts (RAP, IBR or the 10-year Standard plan). If your income is high and you want the loans gone, the 10-year Standard plan plus extra payments usually costs the least interest.
No. A court ended SAVE, nobody new can enroll, and everyone who was on it has to pick another plan after their servicer’s notice. If you don’t pick one, you’re placed on the Standard plan, or Tiered Standard if you have a loan paid out on or after July 1, 2026.
It depends on your income. RAP is often a little cheaper at middle incomes and waives interest your payment doesn’t cover, but it has no payment cap and forgiveness takes 30 years. IBR is capped at the 10-year Standard amount and forgives after 20 or 25 years. IBR is only open if all your loans were paid out before July 1, 2026.
Yes. If you’re on an income-driven plan, you can change to any other plan you’re eligible for at any time. Just check the cost first: leaving IBR adds unpaid interest to your principal, and RAP months don’t count toward IBR forgiveness if you go back later.
Loans paid out before July 1, 2026 default to the 10-year Standard plan (or the consolidation Standard plan). Loans paid out on or after July 1, 2026 default to Tiered Standard. You can switch any time on StudentAid.gov or through your servicer.
Sources (10)
We use primary sources: Federal Student Aid, the U.S. Department of Education, the Federal Register and the U.S. Department of Health and Human Services.
- Federal Student Aid. Repayment Plans. studentaid.gov. Accessed October 22, 2026.
- Federal Student Aid. Income-Driven Repayment Plans. studentaid.gov. Accessed October 22, 2026.
- Federal Student Aid. Big Updates to Federal Student Aid. studentaid.gov. Accessed October 22, 2026.
- Federal Student Aid. Definitions: Repayment Assistance Plan and Tiered Standard Plan. studentaid.gov. Accessed October 22, 2026.
- Federal Student Aid. Top FAQs About Income-Driven Repayment Plans. studentaid.gov. Accessed October 22, 2026.
- Federal Student Aid. SAVE Plan Borrowers: FAQs About Choosing a Different Repayment Plan. studentaid.gov. Accessed October 22, 2026.
- Electronic Code of Federal Regulations. 34 CFR 685.209, Income-driven repayment plans. ecfr.gov. Accessed October 22, 2026.
- Federal Register. Reimagining and Improving Student Education: Federal Student Loan Program Final Regulations. federalregister.gov. Accessed October 22, 2026.
- U.S. Department of Health and Human Services, ASPE. Poverty Guidelines. aspe.hhs.gov. Accessed October 22, 2026.
- Federal Student Aid. Public Service Loan Forgiveness. studentaid.gov. Accessed October 22, 2026.
