SoFi

The average natural gas bill in the United States is $80 to $100 per month. Your monthly gas bills could vary significantly, depending on the time of year, where you live, the size and age of your home, and other factors.

Read on for a breakdown of what can cause your gas bill to go up and down from one month to the next, how to budget for those price changes, and how you might be able to lower your costs in the future.

How Much Does a Gas Bill Cost Per Month on Average?

The average cost of gas per month in the U.S. has hovered around $80 in recent years. Your household’s cost could be much lower or higher, depending on your location and its cost of living by state, the size and age of your home, the appliances you use, inflation, and the ever-fluctuating cost of natural gas. Your bill might be much higher, for example, than that of a friend who has the same size house in a state with a warmer climate. And it could be less than what your next door neighbor pays, if your home is smaller or more energy efficient.

Recommended: Does Net Worth Include Home Equity?

Why Is My Gas Bill Higher Than Usual?

If your gas bill seems higher than usual, it could be that your provider is charging a higher rate. (You can check that by comparing two or more months’ worth of gas bills, or credit card statements if that’s how you pay your bills.) It could also be that you’re simply using more gas because it’s colder outside. Or maybe you’ve been taking more hot showers or running the dishwasher, clothes dryer, or gas fireplace more often. Working from home is a common reason that utility bills are sometimes higher.

If you can’t come up with a reasonable answer for the cost increase, you may want to talk to your gas provider or check your statement to see if your usage is up. But be prepared: The calculations that go into determining your monthly gas bill can be complicated.

Recommended: What Percentage of Income Should Go to Rent and Utilities?

Understanding the Monthly Cost of Gas

In the U.S., natural gas can be priced in a few different ways, including dollars per therm, dollars per British thermal unit (BTU), and dollars per cubic foot.

Here’s what you really need to know: According to the U.S. Energy Information Administration, the price residential customers pay for natural gas is determined by two major factors:

•   Commodity Cost: The actual cost of the gas.

•   Transmission and Distribution Costs: The costs involved with moving the natural gas from where it’s produced or stored to a local natural gas distribution utility, plus whatever it costs to deliver the gas to customers.

If you live in a state with easy access to residential gas (Alaska, Utah, Washington, Colorado), the monthly rate you pay may be lower than if your utility has to transport the gas a long distance to reach you (in say, Hawaii).

The price you ultimately pay for natural gas in your state, city, or subdivision also may be affected by state regulations, taxes and other charges, availability, seasonal consumer demand, and the amount of competition in your location. (By the way, there’s no relation between the cost of natural gas and the price of gasoline.)

Recommended: Budget Planner and Spending App

Average Gas Bill Based on Household Size

Knowing the natural gas rates in your area can help you understand why your bills might be higher or lower than you expected. But the size of your home and the number of people who live there can also influence your average monthly gas bill. Keeping these things in mind can help you predict your gas usage when you make a budget.

Prices can vary significantly by season, with costs rising if you need to stay warm in cold winter months. According to HomeGuide.com, monthly gas costs in winter can be $120 to $200 versus $35 to $50 in summer.

Here’s a rough estimate of what the average monthly cost of gas could be for various apartment size, according to ApartmentList.com. Apartment costs may well be less than the cost for gas for a house, given that a house is likely to be larger and have more appliances, among other factors.

Remember that your costs may be much different depending on how many gas appliances you have in your home, how warm you keep your home in the winter, what you keep the temperature set to on your water heater, and other factors.

Recommended: Should I Sell My House Now or Wait?

What Uses the Most Gas in a Home?

The top uses for natural gas in U.S. households are heating and water heating. But many homes also use gas for cooking, indoor or outdoor fireplace, clothes dryer, or heating a pool. (Worth noting: Replacing home appliances can lead to greater energy efficiency.)

How Can I Lower My Gas Bill?

Even if you earn the average salary in the U.S., it may be challenging to afford your gas bill at times.

There are several steps you can take to lower your natural gas bill. (You may be interested in lowering your car’s gas bill, too.)

Get a Home Energy Assessment

A professional home energy auditor looks at your past bills for information about your energy use, and inspects your home to pinpoint problem areas and offer money-saving suggestions. Your gas company may offer assessments to its customers, or you may be able to get help finding an energy audit program through your state or local government.

Balance Costs Across the Year

If your local utility offers a yearly budget plan, you may be able to spread out your costs so that your bill is roughly the same amount each month. This can keep bills from becoming overwhelming in months when you use more gas. Or you can use a money tracker app to determine your average monthly cost of gas and set aside the appropriate amount.

Lower Your Water Heater Temperature

When was the last time you even looked at your water heater? Lowering the temperature to 120 degrees can help you save money, prevent family members from accidentally scalding themselves, and protect your pipes. You can also purchase a special blanket or “jacket” to insulate your water heater and make it more efficient.

Look for Leaks

If your doors and windows are getting older, check whether cold air is coming in and warm air escaping. Clear plastic film or weather stripping may be all you need to fix the problem.

Lower the Thermostat

The U.S. Department of Energy recommends setting your thermostat at 68 degrees when you’re home during the winter, and turning it down a few degrees more when you’re away. If you keep pretty standard hours, a programmable thermostat can ensure the house is comfortable when you get home from school or work. And if you work from home, you can lower the temp when you go to bed, or pull on a sweater during the day.

One note: If you get hit with a super-high bill one month (say, due to a polar vortex triggering frigid temperatures), that may be a time to dip into your emergency fund. It’s there to help you cover unexpected expenses

Assistance Programs to Help with Your Gas Bill

If you’re struggling to pay your gas bill, you may be able to get some help from a federal, state, or local government assistance program or from a nonprofit agency. Here are a few options to consider:

Low Income Home Energy Assistance Program

The Low Income Home Energy Assistance Program (LIHEAP), operated through the U.S. Department of Health and Human Services, was created to help low-income households pay high home energy bills. Each state has its own rules regarding who is eligible for help and when and how to apply. (Assistance isn’t made directly to households.) For more information, go to the LIHEAP website.

Low Income Home Energy Assistance Program

The Low Income Home Energy Assistance Program (LIHEAP), operated through the U.S. Department of Health and Human Services, was created to help low-income households pay high home energy bills. Each state has its own rules regarding who is eligible for help and when and how to apply. (Assistance isn’t made directly to households.) For more information, go to the LIHEAP website or call 202-401-9351.

Local Utility Company Programs

Some utility companies offer limited bill-paying assistance programs on their own or working alongside state agencies or nonprofit organizations. Check your local gas company’s website to see if they offer help, or try giving them a call. Your gas company may take special circumstances into consideration when it comes to paying your bill.

SoCalGas, for example, offers past-due bill forgiveness, discounted rates, and extended payment dates for certain qualifying customers. The utility also works to provide one-time grants through their Gas Assistance Fund.

Recommended: Free Credit Score Monitoring

The Takeaway

The average cost of gas per month for a house is $80 to $100. The location, size, and age of your home — and, of course, the time of year — can affect your gas bill from one month to the next. So can the number of people in your household and the appliances you use. The rate you pay each month for gas may also fluctuate based on factors over which you have no control. All those things combined can mean that budgeting for your monthly gas bill requires some careful oversight.

Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.

See exactly how your money comes and goes at a glance.

FAQ

How much does the average person pay for gas each month?

The average household pays about $80 to $100 per month for natural gas. Your bill could vary significantly, however, based on location, home size, number of residents, your appliances, whether you work from home, and more.

How much should you budget for gas a month?

One way to determine how much to budget for gas each month is to track your spending, then calculate the average monthly amount based on past bills. You may want to budget an amount that’s a bit higher than in the past, just in case the winter is especially cold or gas rates go up. (If you don’t end up needing the extra funds, you can put the money toward your emergency fund or another bill.)

What’s the average price of natural gas in San Francisco?

According to UtilitiesLocal.com, residential natural gas prices in San Francisco rose slowly but significantly from September 2021 to September 2022. Rates increased by approximately 34% year over year.

Photo credit: iStock/DGLimages

SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

This content is provided for informational and educational purposes only and should not be construed as financial advice.


Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.


External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

Third Party Trademarks: Certified Financial Planner Board of Standards Inc. (CFP Board) owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®, CFP® (with plaque design), and CFP® (with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board's initial and ongoing certification requirements.

SORL-Q125-026

Many people struggle to keep up with the demands and expenses of daily life, which can create stress and anxiety. That’s why some choose a minimalist lifestyle: Fewer possessions make for easier management. Minimalists strive to eliminate anything in their life that does not serve their purpose. This leads to more physical, emotional, and financial space.

If the concept of minimalism appeals to you, read on to better understand what a minimalist lifestyle is, its benefits, and how to start on the path to a simpler, more manageable, and possibly more affordable lifestyle.

What Is a Minimalist Lifestyle?

Minimalist living is uncluttered by superfluous items like luxury cars, excessive clothing, and purely decorative furnishings. There can be many reasons someone chooses a minimalist lifestyle; they might want to simplify their life to reduce stress, improve their health, or reduce harm to the environment. They may also want to cut back on expenses and improve their budgeting and finances.

Recommended: Free Credit Score Monitoring

Surprising Benefits of a Minimalist Lifestyle

When you have less stuff, it follows that you have less to worry about. A minimalist lifestyle allows you to carry less literal and metaphorical baggage around.

Another benefit is that minimalists buy fewer things, which can allow you to save money. From a holistic perspective, minimalism reduces consumerism, and that can benefit the planet.

How to Live a Minimalist Lifestyle

Living a minimalist lifestyle can seem daunting for some, requiring a mindset shift. Here’s a window into a more minimalist mindset and lifestyle to give you a taste of what it involves. And don’t forget as you read that there are benefits to living below your means.

Invest in Experiences

Rather than collecting things and possessions, a minimalist lifestyle emphasizes experiences. Minimalists spend, just in a more deliberate way. For example, minimalists may spend on vacations and concerts rather than on cars and jewelry.

Audit Your Life

Auditing your life involves deciding what is most important and eliminating anything superfluous. Deciding what is most important can be difficult, but some questions to ask yourself are: How am I doing mentally and physically? What’s important to me now that perhaps wasn’t before? The answer to these and similar questions can help you pinpoint your core values and priorities.

A free budget app can help you audit your spending and evaluate how much of it is really necessary.

Eliminate Needless Expenses

A meaningless expense to one person may be valuable to another. That’s why conducting a life audit is important to help you decide which expenses are not serving your purpose. For example, a person might discover that buying gas is often unnecessary if they can manage without a car most of the time. Or that mid-price brands and gently used items can be just as nice as luxury goods.

Set Limits and Delegate

A minimalist lifestyle is easier to control. Setting limits and delegating is one way to live a minimalist lifestyle because you have less to manage. For example, you might use an accountant to do your taxes, or hire someone to manage your website. You might have fewer screens or electronics or downsize to a smaller home.

Recommended: Does Net Worth Include Home Equity?

Honor Your Priorities

The goal of auditing your life is to establish priorities to eliminate what doesn’t align with them. Part of the journey to minimalism is learning to appreciate what you have and not constantly desire new things. Perhaps you and your partner decide to live on a single income while one of you cares for the family. You may also earn less and have to economize.

Minimalist Lifestyle Tips

How do you implement a minimalist lifestyle? Because the changes can be profound, try making small changes at first as you gradually adjust to a new mindset.

Recommended: What Is the 50-30-20 Budget?

1. Declutter Your Environment and Your Mind

A great place to start is to declutter your environment. Start with your home, your workspace, your car. Get rid of things you haven’t used in a while or that you are just hanging onto in case you need them. As the space around you becomes less messy, you might find your thinking becomes more clear. You can also make some money by selling your unwanted stuff or donate items.

2. Be a Purposeful Not Prolific Consumer

Minimalists still make purchases, but the emphasis is on quality rather than quantity. An example is choosing to use one credit card that serves many purposes rather than five because each one comes with different rewards. Yes, you may benefit from free miles and cash back, but you will also have to buy more to earn those points and rewards, which is consumerism, the antithesis of financial minimalism.

3. Digitize Movies and Books

Most of us have bookcases full of books that sit and gather dust. It’s fine to keep some treasured items and classic novels, but you can also download e-books or visit your local library. Declutter your home of old DVDs, CDs, and books you don’t need.

4. Recycle and Reuse

Reusing shopping bags, refilling a water bottle instead of buying bottled water, or taking your own cup to Starbucks are ways to cut back on trash and single-use products. You’ll save money and help the environment.

5. Get Organized

As you declutter, you’ll find ways to be more organized. Find a space for things you want to keep, and use storage bins and organizers. When everything has a place, you’ll waste less time trying to locate things, and you’ll be more motivated to put things back when you’ve used them.

Recommended: The 52 Week Savings Challenge

The Takeaway

A minimalist lifestyle is appealing, considering how busy and cluttered daily life can be. You don’t have to embrace full-on minimalism immediately but can take small steps, such as establishing goals and priorities, decluttering your environment, and organizing. You can also reduce your expenses and financial obligations this way. As you progress, you may find that your mind clears, your life slows down, and you are able to budget more appropriately too.

Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.

SoFi helps you stay on top of your finances.

FAQ

How do you live a minimalist lifestyle?

Living a minimalist lifestyle requires prioritizing and eliminating things that do not align with your values. The process of elimination will be different for everyone, but it does not have to be quick or painful. Just removing one thing or downloading a budgeting and money tracking app can help you achieve a simple minimalist lifestyle.

What is an example of a minimalist?

An example of a minimalist is someone who lives with very little furniture, or none at all, or someone who moves to a smaller home. A less extreme version of a minimalist might be someone who simplifies things by clearing items from countertops, buys few clothes, or chooses a vegan diet.

What is the 90 rule for minimalism?

The hardest part of achieving a simpler minimalist lifestyle is decluttering. How do you decide what to get rid of? The 90 rule can help. Choose a possession, and ask yourself if you’ve used that item in the past 90 days. If not, then it’s a candidate for elimination from your life because it is not currently serving a useful purpose.

Photo credit: iStock/Pramote Naksomrit

SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

This content is provided for informational and educational purposes only and should not be construed as financial advice.


Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Third Party Trademarks: Certified Financial Planner Board of Standards Inc. (CFP Board) owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®, CFP® (with plaque design), and CFP® (with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board's initial and ongoing certification requirements.

SORL-Q125-008

If you’re on the standard 10-year repayment plan and your federal student loan payments are high relative to your income, a student loan income-based repayment plan may be an option for you.

The newest plan, called SAVE, which was introduced by the Biden Administration, is currently on hold due to legal challenges. Read on to learn what the alternatives are in the meantime.

What Is Income-Based Student Loan Repayment?

Income-based student loan repayment plans were conceived to ease the financial hardship of government student loan borrowers and help them avoid default when struggling to pay off student loans.

Those who enroll in the plans tend to have large loan balances and/or low earnings. Graduate students, who usually have bigger loan balances than undergrads, are more likely to enroll in a plan.

The idea is straightforward: Pay a percentage of your monthly income above a certain threshold for 20 or 25 years. You are then eligible to get any remaining balance forgiven. (The SAVE plan would forgive balances after 10 years for borrowers with original loans of $12,000 or less.)

In mid-2024, 13 million borrowers were enrolled in an income-based repayment plan, according to the Institute for College Access and Success. But borrowers have often failed to recertify their income each year, as required, and are returned to the standard 10-year plan.


💡 Quick Tip: Often, the main goal of refinancing is to lower the interest rate on your student loans — federal and/or private — by taking out one loan with a new rate to replace your existing loans. Refinancing makes sense if you qualify for a lower rate and you don’t plan to use federal repayment programs or protections.

Income-Driven Student Loan Repayment Plans

While people often use the term “income-based repayment” generically, the Department of Education calls them income-driven repayment (IDR) plans. There are four, but two plans recently stopped accepting new borrowers. We’ll focus on the two that are still open to you:

•   Income-Based Repayment (IBR)

•   Saving on a Valuable Education (SAVE), which replaces the previous Revised Pay As You Earn (REPAYE) plan

Your payment amount is a percentage of your discretionary income, defined for IBR as the difference between your annual income and 150% of the poverty guideline for your family size.

For the SAVE plan, discretionary income is the difference between your annual income and 225% of the poverty line for your family size. This plan could substantially reduce borrowers’ monthly payment amounts compared to other IDR plans. For IBR and SAVE, the payment is 5% to 10% of your discretionary income.

Got it? But wait; there’s more. Note the number of years in which consistent, on-time payments must be made and after which a balance may be forgiven, as well as who qualifies.

How Income-Based Student Loan Repayment Works

In general, borrowers qualify for lower monthly loan payments if their total student loan debt at graduation exceeds their annual income.

To figure out if you qualify for a plan, you must apply at StudentAid.gov and submit information to have your income certified. Your monthly payment will then be calculated. If you qualify, you’ll make your monthly payments to your loan servicer under your new income-based repayment plan.

You’ll generally have to recertify your income and family size every year. Your calculated payment may change as your income or family size changes.


💡 Quick Tip: When rates are low, refinancing student loans could make a lot of sense. How much could you save? Find out using our student loan refi calculator.

What Might My Student Loan Repayment Plan Look Like?

Here’s an example:

Let’s say you are single and your family size is one. You live in one of the 48 contiguous states or the District of Columbia. Your adjusted gross income is $40,000, and you have $45,000 in eligible federal student loan debt.

The 2025 government poverty guideline amount for a family of one in the 48 contiguous states and the District of Columbia is $15,650, and 150% of that is $23,475. The difference between $40,000 and $20,385 is $16,525. That is your discretionary income.

If you’re repaying under the IBR plan, 10% of your discretionary income is about $1,652. Dividing that amount by 12 results in a monthly payment of $138.

Under the SAVE Plan, however, your discretionary income is the difference between your gross income and 225% of the poverty line, which comes out to $35,213. The difference between $40,000 and $35,213 is $4,787, which is your discretionary income; 5% of your discretionary income is about $239. That amount divided by 12 results in a monthly payment of $20.

The Federal Student Aid office recommends using its loan simulator to compare estimated monthly payment amounts for both repayment plans.

Which Loans Are Eligible for Income-Based Repayment Plans?

Most federal student loans are eligible for at least one of the plans.

Federal Student Aid lays out the long list of eligible loans, ineligible loans, and eligible if consolidated loans under each plan.

Of course, private student loans are not eligible for any federal income-driven repayment plan, though some private loan lenders will negotiate new payment schedules if needed.

Pros and Cons of Income-Based Student Loan Repayment

Pros

•   Borrowers gain more affordable student loan payments.

•   Any remaining student loan balance is forgiven after 20 or 25 years of repayment.

•   An economic hardship deferment period counts toward the 20 or 25 years.

•   The plans provide forgiveness of any balance after 10 years for borrowers who meet all the qualifications of the Public Service Loan Forgiveness (PSLF) program.

•   The government pays all or part of the accrued interest on some loans in some of the income-driven plans.

•   Low-income borrowers may qualify for payments of zero dollars, and payments of zero still count toward loan forgiveness.

•   New federal regulations will curtail instances of interest capitalization and suspend excess interest accrual when monthly payments do not cover all accruing interest.

Cons

•   Stretching payments over a longer period means paying more interest over time.

•   Forgiven amounts of student loans are free from federal taxation through 2025, but usually the IRS treats forgiven balances as taxable income (except for the PSLF program).

•   Borrowers in most income-based repayment plans need to recertify income and family size every year.

•   On some plans, if a borrower gets married and files taxes jointly, the combined income could increase loan payments. (This is not the case with the SAVE Plan.)

•   The system can be confusing to navigate, especially while the SAVE plan is in legal limbo.

Student Loan Refinancing Tips From SoFi

Income-driven repayment plans were put in place to tame the monthly payments on federal student loans for struggling borrowers. For instance, the SAVE Plan offers the lowest monthly payments of all IDR plans. (Those who have private student loans don’t qualify for IDR plans.)

If your income is stable, your credit is good, and you don’t need federal programs like income-driven repayment plans or deferment, refinancing your student loans is an option. (To be clear, refinancing federal student loans makes them ineligible for federal protections and programs like income-driven repayment and loan forgiveness for public service.) With refinancing, the goal is to pay off your existing loans with one new private student loan that ideally has a lower interest rate.

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

FAQ

Is income-based repayment a good idea?

For borrowers of federal student loans with high monthly payments relative to their income, income-based repayment can be a good idea. Just be aware that legal challenges have put the SAVE plan on hold.

What is the income limit for income-based student loan repayment?

There is no limit. If your loan payments under the 10-year standard repayment plan are high for your income level, you may qualify for income-based student loan repayment.

What are the advantages and disadvantages of income-based student loan repayment?

The main advantage is lowering your monthly payments, with the promise of eventual loan forgiveness if all the rules are followed. A disadvantage is that you have to wait for 10, 20, or 25 years depending on the plan you’re on and how much you owe.

How does income-based repayment differ from standard repayment?

With the standard repayment plan, your monthly payments are a fixed amount that ensures your student loans will be repaid within 10 years. Under this plan, you’ll generally save money over time because your monthly payments will be higher. With income-based repayment, your monthly loan payments are based on your income and family size. These plans are designed to make your payments more affordable. After a certain amount of time ranging from 10 to 25 years, depending on the plan, any remaining balance you owe is forgiven.

Who is eligible for income-based repayment plans?

With the PAYE and IBR plans, in order to be eligible, your calculated monthly payments, based on your income and family size, must be less than what you would pay under the standard repayment plan. Under the ICR plan, any borrower with eligible student loans may qualify. Parent PLUS loan borrowers are also eligible for this plan.

How is the monthly payment amount calculated in income-based repayment plans?

With income-based repayment, your monthly payment is calculated using your income and family size. Your payment is based on your discretionary income, which is the difference between your gross income and an income level based on the poverty line. The income level is different depending on the plan. For IBR, your monthly payment is 10% of your discretionary income.

SoFi Student Loan Refinance
Terms and conditions apply. SoFi Refinance Student Loans are private loans. When you refinance federal loans with a SoFi loan, YOU FOREFEIT YOUR EILIGIBILITY FOR ALL FEDERAL LOAN BENEFITS, including all flexible federal repayment and forgiveness options that are or may become available to federal student loan borrowers including, but not limited to: Public Service Loan Forgiveness (PSLF), Income-Based Repayment, Income-Contingent Repayment, extended repayment plans, PAYE or SAVE. Lowest rates reserved for the most creditworthy borrowers. Learn more at SoFi.com/eligibility. SoFi Refinance Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.