Everyone’s financial goals are different, and there are other factors which might affect which repayment plans you are eligible for.
Every plan displayed in the Savi tool - with the exception of Standard - is an income-driven plan. Any Income-Driven plan (IDR) would be eligible for PSLF. However, they are calculated differently. If your goal is the lowest monthly payment, select the lowest available plan to you. If your goal is to pay off your loans as quickly as possible (this might mean a higher payment), select the plan that is most aligned with that goal.
In order to be eligible for the ICR plan you either:
Have to already be enrolled in ICR
or
You have Parent Plus Loans
ICR (Income Contingent Repayment) is an income-driven repayment plan (IDR) which calculates your monthly payment accordingly:
- The lesser of the following:
- 20% of your discretionary income - OR
- The amount you would pay on a fixed repayment plan over the course of 12 years; adjusted according to your income
- Eligible Loan Types include: Direct Subsidized, Direct Unsubsidized, Direct PLUS loans (graduate or professional students), Direct Consolidation Loans which do not contain any Parent PLUS Loans
- These Loan Types are NOT eligible: Direct PLUS Loans, Direct Consolidation Loans which contain Parent PLUS Loans.
- **Direct Parent PLUS Loans would be eligible for ICR if consolidated
- Repayment period - 25 years
A few other things to consider about ICR:
- If you're married, your spouse's income or loan debt will be considered only if you file a joint tax return or you choose to repay your Direct Loans jointly with your spouse.
- Any outstanding balance will be forgiven if you haven't repaid your loan in full after 25 years. The forgiveness amount will be taxable in the year it is claimed if you are not eligible for PSLF.
For more information about ICR, click here.
Think carefully about your financial goals for your student loans, and which plan best aligns with those goals. Also note, for Income Driven Repayment plans, you need to recertify your income every twelve months. The plan you select will only reflect the payment amount until you recertify your income again the following year. This means that if your income increases, your payments will also increase. Same if your income decreases significantly.