Student Loan Debt in 2025 – Average Balances, Repayment Options, and Relief Strategies

Many recent college graduates (and not so recent college graduates) are dealing with overwhelming student loan debt. As of 2025, U.S. student loan borrowers collectively owe approximately $1.77 trillion in federal and private student loan debt, with the average borrower (with undergraduate student debt) owing around $29,300.

If you are just considering college for the first time, one of the best ways to avoid student loan debt is to get educated on all of your financial aid options for college (not just student loans). If you have already accumulated student loan debt from college, and are now having a difficult time managing your student loan debt, there is help. For those of you with federal student loan debt, the options are greater, however there are some options out there for dealing with private student loan debt as well.

Student Loan Debt: Federal vs. Private Comparison

Learn About Your Student Loan Debt Options

Depending on what type of student loan debt an individual has, their options for debt relief may be different. Federal student loan debt typically offers the most options for debt relief in the form of alternate and income-based repayment programs, as well as student loan forgiveness programs. For private student loans, the debt relief options tend to be more short-term. Most private student loans will offer a deferment or forbearance option, which can help relive an individual of their monthly payment obligations while unemployed (for example), however some individuals may have the option of consolidating their private student loans, which may provide a more long-term debt relief solution in the form of a more manageable monthly payment amount. Before utilizing a debt relief program or option, be certain to understand the pros and cons associated with it. For example, a student loan consolidation may reduce your monthly student loan payments, however you may end up paying more in interest charges over the lifetime of the loan, or a deferment on your student loans may halt your payments for a period of time, but the interest on your loans will likely capitalize.

Repayment Options for Federal Student Loan Debt

Federal student loans come with built-in repayment protections and flexibility that make managing your debt easier than private loans. Whether you’re struggling financially or looking to minimize long-term interest, the U.S. Department of Education offers several repayment options:

Standard Repayment Plan

This is the default plan. It has fixed monthly payments over 10 years and is best for borrowers who can afford consistent payments and want to pay off their loans quickly with minimal interest.

Income-Driven Repayment (IDR) Plans

IDR plans adjust your monthly payment based on your income and family size. These plans are ideal for borrowers with low or variable income and include:

• PAYE (Pay As You Earn)
• REPAYE (Revised Pay As You Earn)
• Income-Based Repayment (IBR)
• Income-Contingent Repayment (ICR)

Under these plans, any remaining balance may be forgiven after 20–25 years of qualifying payments.

Public Service Loan Forgiveness (PSLF)

Borrowers working in qualifying nonprofit or government jobs may be eligible for forgiveness after making 120 qualifying payments under an IDR plan.

Extended and Graduated Repayment Plans

These plans stretch repayment over up to 25 years and may start with lower monthly payments that increase over time — ideal for those who expect their income to rise.

Deferment and Forbearance

If you’re facing temporary financial hardship, you may be eligible to pause your federal student loan payments through deferment or forbearance. However, interest may still accrue during these periods.

Repayment and Refinancing Options for Private Student Loans

Unlike federal loans, private student loans are issued by banks, credit unions, and online lenders — and they don’t come with government protections like forgiveness or IDR plans. That said, you still have some options for managing private loan debt:

Standard Repayment Plans

Most private lenders offer fixed monthly payment plans over 5, 10, or 15 years. Some allow interest-only payments while you’re in school or during a grace period after graduation.

Refinancing Your Private Student Loans

Student loan refinancing is the most powerful way to manage private loan debt — especially if you have good credit or a strong cosigner. When you refinance, you’re taking out a new loan with a private lender to pay off one or more existing loans, ideally at a lower interest rate.

• Lower your monthly payment by extending your repayment term
• Save on interest by qualifying for a better rate
• Simplify repayment by combining multiple loans into one

Keep in mind: Once you refinance federal loans into a private loan, you lose access to federal repayment and forgiveness programs — so only refinance federal loans if you’re sure you won’t need those protections.

Temporary Forbearance or Hardship Options

Some private lenders offer temporary relief during unemployment or financial hardship, but it varies by lender. Contact your servicer to ask about deferment, forbearance, or payment flexibility options.

Cosigner Release

If you originally took out a private loan with a cosigner, some lenders allow you to remove them from the loan after making a certain number of on-time payments — typically 12 to 36 months.

What Should I Do If I Can’t Pay My Student Loans?

If you’re reading this, it’s likely you’re feeling the weight of student loan debt and wondering what to do if you just can’t make those payments. Trust me, you’re not alone. Life happens—whether it’s a job loss, medical emergency, or unexpected financial curveball. The good news? There are options, and the sooner you take action, the better.

1. Reach Out to Your Loan Servicer ASAP

First things first: don’t bury your head in the sand. If you’re having trouble making payments, you need to get in touch with your student loan servicer (the company handling your loan). They’re there to help, and many are willing to work with borrowers who are struggling. It’s much better to let them know upfront than risk your account going into default.

Pro Tip: Keep your communication clear and honest. Be upfront about your situation and let them know if you’ve hit a rough patch. They might offer deferment, forbearance, or a more manageable payment plan.

2. Explore Repayment Options

Your loan servicer has a variety of repayment plans at their disposal. Some might lower your monthly payment to something more manageable. For instance, you might qualify for income-driven repayment (IDR) plans, which base your payments on your income. If your financial situation is tight, you could also look into consolidating your loans, which might make things easier by combining multiple loans into one monthly payment.

Pro Tip: Take the time to understand your repayment options. Different loans (federal vs. private) have different terms, so knowing your options will put you in the driver’s seat when it comes to managing your debt.

3. Ask About Deferment or Forbearance

If you’re temporarily struggling and need a breather, don’t hesitate to ask your loan servicer about deferment or forbearance. These are temporary pauses on payments, but they come with different terms. Deferment typically allows you to pause payments without your loan going into default, and in some cases, you won’t even accrue interest during that period. Forbearance, on the other hand, may still allow for interest to accrue, but it’s another option to buy you some time.

Pro Tip: While deferment sounds great, remember that forbearance might end up costing you more in the long run because interest keeps piling up. Make sure you understand the pros and cons before you decide.

4. Show Good Faith

Once you’ve worked out an arrangement with your servicer, it’s time to show some good faith. Follow through with everything you’ve agreed upon—whether it’s sending in forms or making payments on time. If you hit another snag, keep the lines of communication open. Ignoring your loans is the quickest way to spiral into default, so stay proactive and be responsive.

Pro Tip: Don’t be afraid to ask for help if you’re confused about paperwork or terms. There are nonprofit credit counseling agencies that can assist you for free or low-cost.

5. Don’t Wait Until It’s Too Late

If you miss a payment or can’t make the one you promised, contact your servicer immediately. The earlier you reach out, the more options you have. If you let too much time pass, you risk defaulting on your loan, which can have long-lasting consequences on your credit score and your financial future. Stay ahead of the game by getting in touch at the first sign of trouble.

Pro Tip: If you’re having trouble keeping track of due dates, set up automatic payments or alerts to make sure you never miss one.

Take Control of Your Student Loan Situation

Life can get overwhelming when it feels like you’re drowning in student loan debt, but there’s always a way out. By reaching out to your loan servicer, reviewing your repayment options, and being proactive, you can make your payments more manageable. And if things get really tough, there are temporary solutions like deferment or forbearance that can buy you some time. Whatever you do, just make sure you don’t ignore the problem. The sooner you address it, the easier it’ll be to find a solution that works for you.

What Happens If Student Loan Payments Are Ignored

Not repaying your student loans or simply ignoring the student loan payments, should be avoided at all costs. Borrowers who can not afford to pay back their student loans, should contact their student loan lenders immediately to find out their options. There are some federal programs set up to aid qualified borrowers in the repayment of their student loans, and some private student loan lenders may be willing to work with their borrowers who are willing to put forth a good faith effort. Ignoring student loan payments can result in the following actions being taken:

1. Your loans may be turned over to a collection agency. You’ll be liable for the costs associated with collecting your loan, including court costs and attorney fees.

2. You can be sued for the entire amount of your student loans. Your wages may be garnished. Your federal and state income tax refunds may be intercepted. The federal government may withhold part of your Social Security benefit payments.

3. Your defaulted loans will appear on your credit record, making it difficult for you to obtain an auto loan, mortgage, or even credit cards. A bad credit record can also harm your ability to find a job.

4. You won’t receive any more federal financial aid until you repay the loan in full or make arrangements to repay what you already owe and make at least six consecutive, on-time monthly payments. (You will also be ineligible for assistance under most federal benefit programs). You’ll be ineligible for student loan deferments. Subsidized interest benefits will be denied.

5. You may not be able to renew a professional license you hold.

6. You may be prohibited from enlisting in the armed forces.