Ultimate Guide to Student Loan Repayment for Engineers

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Refinancing with Earnest

Refinancing rates from 2.47% APR. Checking your rates won’t affect your credit score.

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You have your engineering degree, you have your job… and now you have to start paying back your student loans.

Wait, being saddled with debt for the next 20 years wasn’t part of your plan? Well, if you play your cards right and use your income wisely, you’ll get out of debt a lot sooner.

Here’s what you do.

Get a handle on your engineering student loans

1. Optimize your payments

The best thing you can do for your engineering student loans is to optimize your payments right away. That way you can ensure that more of your money is going straight to your balance rather than interest.

Lower your interest rate

The first step in battling interest is obvious: pay less of it. You can make this happen by refinancing your student loans.

When you refinance your student loans, you’re applying for a new loan for a better interest rate or better repayment terms. But going for the lowest interest rate is how you can pay your debt off faster.

One thing to be aware of is that refinancing federal loans converts them to private loans. That means you’ll no longer have access to things like federal forbearance, deferment, forgiveness, or income-driven repayment plans.

Regarding engineering student loan forgiveness, there aren’t as many options as there are for other professions, such as those in health care.

However, you may be eligible for student loan forgiveness for engineers if you work for a qualifying non-profit and have your loans forgiven through Public Service Loan Forgiveness.

Another option for student loan forgiveness for engineers is if you opt to teach instead of work as an engineer full-time to qualify for Teacher Loan Forgiveness.

Finally, you can try to find engineering student loan forgiveness in your state, especially if they offer forgiveness for STEM degrees. For example, The Alfond Foundation is set to help pay the debt of college graduates in STEM fields who commit to working in these fields in specific companies in Maine. North Dakota has a similar program. Do some research on your state or the state in which you work to see if some such program exists – these types of things aren’t often widely advertised.

If these forgiveness options don’t apply to you and you’ve secured employment at a company that looks like it will stand the test of time, then refinancing to private loans might not be a concern.

But if you’re founding a company or joining a startup, it might be more of a risk to give up the options that come with federal loans.

Pay biweekly

After you’ve secured your best interest rate – or even if you chose not to refinance – the next best thing for you to do is start making payments on your loans biweekly instead of monthly.

Here’s how you pay biweekly:

  • Split your monthly payment in half.
  • Make your half payment every other week.
  • Ensure that your first two half payments are made before your next due date.
  • Read your statement online to make sure your servicer is applying them correctly.

The reason this subtle change to your payments makes a difference in your debt payoff is that there are enough weeks in the year that biweekly half payments lead to one full extra payment per year.

Remember, any extra payment can go a long way. When I tried this biweekly payment method myself, I found I could save approximately $2,000 in interest and shave one and a half years off my total repayment. All it took was making one simple change.

Bonus: if your employer pays you biweekly, you can automatically deduct your half payments from your paycheck.

As for making sure your payments are applied correctly, this step is crucial. Some student loan servicers will hold extra payments until the next due date rather than apply the extra to the principal balance.

You can make sure this isn’t happening to you by reviewing the way your payments are applied online or calling your servicer to make sure they’re being applied correctly.

2. Create your target payoff date

Once you’ve optimized your payments to make sure as much of your money is going to the balance as possible, the next step is to set a target payoff date.

Sure, you could skip this step and just pay off the loans along with the repayment plan. But doing so could cost you big.

Use your salary to beat the date and save on interest

If you want to get the most out of your earnings, figure out a date you want to be finished paying your debt by. There are a few ways to think about setting your target date:

  • Choose a target date based on the maximum amount you can afford to pay each month.
  • Decide on a payoff date based on the maximum amount of years you’re okay with being in student loan debt.
  • Think about another goal you want to reach and pick your date based on when you want to reach that goal.

Once you’ve picked a target payoff date, it’s time to do some calculations. You can use this Payment calculator to help.

Track your progress

Setting a goal usually works best if you track your progress. After all, you make what you measure.

The good news is technology is on your side here. There are tools and apps that can help you track your student loan debt payoff progress.

A fan of measurement myself, here’s a screenshot of my progress chart using the Student Loan Hero dashboard.

engineering student loans calculations

To be honest, I’m not thrilled with my numbers here. Considering the fact that I’ve been paying these loans for more than ten years, I wish I was a lot further along. But I never bothered trying to pay my loans down faster than my original date. So, this is what I get for that.

Now, look what would happen if I were to switch gears and decide I want to pay the remainder of my debt in five years.

engineering student loans payment

My monthly bill would nearly double, but the amount I’d save in the end is not trivial. If I were to follow my current plan, based on the calculations below, I would pay $28,072 in interest overall.

engineering student loans payment calculator

Going down to a 15-year plan, I’d only pay $20,377 overall – a $7,695 savings. That’s money that I could invest instead.

See why creating and tracking a plan can be so effective?

3. Prepare for life after student loan debt

Staying motivated is one of the hardest things about student loan debt repayment – especially if you’re trying to get out of debt faster.

As you dig into your career, there are going to be so many happy hours, lunches, and other activities way more fun and exciting than accelerating your debt payoff. But if you stay focused and keep your eye on the prize, you’ll save a lot more money in the long-run.

That’s why you should start thinking about what that life looks like now. Is it buying a house? Developing a career as a digital nomad? Maybe it’s going into a startup accelerator and building your own business.

Whatever it is you’re dreaming of, get ready for it now, so you don’t lose sight of your ultimate goal.

Put your income to good use with a spending plan

No matter how good your pay, if you don’t have a spending plan, you’re probably wasting money. Remember you make what you measure? That works for money management too.

Developing a spending plan is a great way to put your income to good use. And it doesn’t imply that you can’t have fun with your money. You worked hard to get your degree and land your job – you should have some fun! But not so much that you spend every dollar you earn unchecked.

Think of it this way. A spending plan can help you maximize your earnings by giving every dollar a job. Rather than spending freely, you can decide how much of your money you want to go to savings, entertainment, technology, and so on.

And if you start budgeting now, you’ll be way ahead of the game compared to most. According to a U.S. Bank study, only 41 percent of Americans follow a budget. That same study showed that 52 percent are concerned with their finances.

Imagine how many future money challenges you could avoid if you take the time to learn to budget now.

Start investing ASAP

Here’s another fun fact: The sooner you pay off debt, the more money you’ll have to invest. And that means your money can scale beyond the limits of what you can save from your salary.

If your company offers a 401(k) with a match, then there’s no need to wait. And if you’re currently not taking advantage of your employer match on a 401(k), then you’re just throwing away free money. Go ahead and contribute as much as your match so you can at least get that covered.

Last year’s Economic Policy Institute’s report on retirement shows that “nearly half of families have no retirement account savings at all.” So if you get that match now – or open an IRA if your employer doesn’t offer a 401(k), then you’re already ahead of many Americans.

Retirement might feel about a million years away now, but it’ll creep up faster than you think.

Pay engineering student loans faster so you can grow your money

If you’re wondering why there’s so much emphasis here on paying your debt off faster, it’s because doing so will free up your money for investments and growth. Not to mention, you can more quickly stop losing money to interest.

It’s all about making sure you get the most bang for your buck.

(TL;DR: Refinance to lower your interest rates, pay biweekly to make faster progress, make a goal and track your movement to it, and get out of debt faster so you can invest and grow your money beyond your pay.)

Interested in refinancing student loans?

Here are the top 6 lenders of 2018!
LenderVariable APREligible Degrees 
Check out the testimonials and our in-depth reviews!
1 Important Disclosures for Earnest.

Earnest Disclosures

To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.

Earnest fixed rate loan rates range from 3.89% APR (with Auto Pay) to 6.97% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 6.30% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of Month/Day/Year, and are subject to change based on market conditions and borrower eligibility.

Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.

The information provided on this page is updated as of 08/21/18. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at hello@earnest.com, or call 888-601-2801 for more information on ourstudent loan refinance product.

© 2018 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.


2 Important Disclosures for Laurel Road.

Laurel Road Disclosures

APR stands for “Annual Percentage Rate.” Rates listed include a 0.25% EFT discount, for automatic payments made from a checking or savings account. Interest rates as of 11/8/2018. Rates subject to change.

Variable rate options consist of a range from 3.27% per year to 6.09% per year for a 5-year term, 4.64% per year to 6.14% per year for a 7-year term, 4.69% per year to 6.19% per year for a 10-year term, 4.94% per year to 6.44% per year for a 15-year term, or 5.19% per year to 6.69% per year for a 20-year term, with no origination fees. APR is subject to increase after consummation. The variable interest rate will change on the first day of every month (“Change Date”) if the Current Index changes. The variable interest rates are based on a Current Index, which is the 1-month London Interbank Offered Rate (LIBOR) (currency in US dollars), as published on The Wall Street Journal’s website. The variable interest rates and Annual Percentage Rate (APR) will increase or decrease when the 1-month LIBOR index changes. The variable interest rates are calculated by adding a margin ranging from 0.98% to 3.80% for the 5-year term loan, 2.35% to 3.85% for the 7-year term loan, 2.40% to 3.90% for the 10-year term loan, 2.65% to 4.15% for the 15-year term loan, and 2.90% to 4.40% for the 20-year term loan, respectively, to the 1-month LIBOR index published on the 25th day of each month immediately preceding each “Change Date,” as defined above, rounded to two decimal places, with no origination fees. If the 25th day of the month is not a business day or is a US federal holiday, the reference date will be the most recent date preceding the 25th day of the month that is a business day. The monthly payment for a sample $10,000 loan at a range of 3.27% per year to 6.09% per year for a 5-year term would be from $180.89 to $193.75. The monthly payment for a sample $10,000 loan at a range of 4.64% per year to 6.14% per year for a 7-year term would be from $139.65 to $146.76. The monthly payment for a sample $10,000 loan at a range of 4.69% per year to 6.19% per year for a 10-year term would be from $104.56 to $111.98. The monthly payment for a sample $10,000 loan at a range of 4.94% per year to 6.44% per year for a 15-year term would be from $78.77 to $86.78. The monthly payment for a sample $10,000 loan at a range of 5.19% per year to 6.69% per year for a 20-year term would be from $67.05 to $75.68.

However, if the borrower chooses to make monthly payments automatically by electronic funds transfer (EFT) from a bank account, the variable rate will decrease by 0.25%, and will increase back up to the regular variable interest rate described in the preceding paragraph if the borrower stops making (or we stop accepting) monthly payments automatically by EFT from the designated borrower’s bank account.


3 Important Disclosures for SoFi.

SoFi Disclosures

  1. Student loan Refinance: Fixed rates from 3.899% APR to 7.979% APR (with AutoPay). Variable rates from 2.470% APR to 6.990% APR (with AutoPay). Interest rates on variable rate loans are capped at either 8.95% or 9.95% depending on term of loan. See APR examples and terms. Lowest variable rate of 2.470% APR assumes current 1 month LIBOR rate of 2.30% plus 0.91% margin minus 0.25% ACH discount. Not all borrowers receive the lowest rate. If approved for a loan, the fixed or variable interest rate offered will depend on your creditworthiness, and the term of the loan and other factors, and will be within the ranges of rates listed above. For the SoFi variable rate loan, the 1-month LIBOR index will adjust monthly and the loan payment will be re-amortized and may change monthly. APRs for variable rate loans may increase after origination if the LIBOR index increases. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. *To check the rates and terms you qualify for, SoFi conducts a soft credit inquiry. Unlike hard credit inquiries, soft credit inquiries (or soft credit pulls) do not impact your credit score. Soft credit inquiries allow SoFi to show you what rates and terms SoFi can offer you up front. After seeing your rates, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit inquiry. Hard credit inquiries (or hard credit pulls) are required for SoFi to be able to issue you a loan. In addition to requiring your explicit permission, these credit pulls may impact your credit score.
  2. Terms and Conditions Apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet SoFi’s underwriting requirements. Not all borrowers receive the lowest rate. To qualify for the lowest rate, you must have a responsible financial history and meet other conditions. If approved, your actual rate will be within the range of rates listed above and will depend on a variety of factors, including term of loan, a responsible financial history, years of experience, income and other factors. Rates and Terms are subject to change at anytime without notice and are subject to state restrictions. SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. Licensed by the Department of Business Oversight under the California Financing Law License No. 6054612. SoFi loans are originated by SoFi Lending Corp., NMLS # 1121636. (www.nmlsconsumeraccess.org)

4 Important Disclosures for LendKey.

LendKey Disclosures

Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.


5 Important Disclosures for CommonBond.

CommonBond Disclosures

  1. Offered terms are subject to change. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900). The following table displays the estimated monthly payment, total interest, and Annual Percentage Rates (APR) for a $10,000 loan. The Annual Percentage Rate (APR) shown for each in-school loan product reflects the accruing interest, the effect of one-time capitalization of interest at the end of a deferment period, a 2% origination fee, and the applicable Repayment Plan. All loans are eligible for a 0.25% reduction in interest rate by agreeing to automatic payment withdrawals once in repayment, which is reflected in the interest rates and APRs displayed. Variable rates may increase after consummation. All variable rates are based on a 1-month LIBOR assumption of 2.08% effective July 25, 2018.

6 Important Disclosures for Citizens Bank.

Citizens Bank Disclosures

  1. Education Refinance Loan Rate Disclosure: Variable rate, based on the one-month London Interbank Offered Rate (“LIBOR”) published in The Wall Street Journal on the twenty-fifth day, or the next business day, of the preceding calendar month. As of November 1, 2018, the one-month LIBOR rate is 2.29%. Variable interest rates range from 2.79%-8.39% (2.79%-8.39% APR) and will fluctuate over the term of the borrower’s loan with changes in the LIBOR rate, and will vary based on applicable terms, level of degree earned and presence of a cosigner. Fixed interest rates range from 3.75%-8.69% (3.75%-8.69% APR) based on applicable terms, level of degree earned and presence of a cosigner. Lowest rates shown require application with a cosigner, are for eligible, creditworthy applicants with a graduate level degree, require a 5-year repayment term and include our Loyalty discount and Automatic Payment discounts of 0.25 percentage points each, as outlined in the Loyalty and Automatic Payment Discount disclosures. The maximum variable rate on the Education Refinance Loan is the greater of 21.00% or Prime Rate plus 9.00%. Subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change. Please note: Due to federal regulations, Citizens Bank is required to provide every potential borrower with disclosure information before they apply for a private student loan. The borrower will be presented with an Application Disclosure and an Approval Disclosure within the application process before they accept the terms and conditions of their loan.
  2. Federal Loan vs. Private Loan Benefits: Some federal student loans include unique benefits that the borrower may not receive with a private student loan, some of which we do not offer with the Education Refinance Loan. Borrowers should carefully review their current benefits, especially if they work in public service, are in the military, are currently on or considering income based repayment options or are concerned about a steady source of future income and would want to lower their payments at some time in the future. When the borrower refinances, they waive any current and potential future benefits of their federal loans and replace those with the benefits of the Education Refinance Loan. For more information about federal student loan benefits and federal loan consolidation, visit http://studentaid.ed.gov/. We also have several resources available to help the borrower make a decision at http://www.citizensbank.com/EdRefinance, including Should I Refinance My Student Loans? and our FAQs. Should I Refinance My Student Loans? includes a comparison of federal and private student loan benefits that we encourage the borrower to review.
  3. Citizens Bank Education Refinance Loan Eligibility: Eligible applicants may not be currently enrolled. Applicants with an Associate’s degree or with no degree must have made at least 12 qualifying payments after leaving school. Qualifying payments are the most recent on time and consecutive payments of principal and interest on the loans being refinanced. Primary borrowers must be a U.S. citizen, permanent resident or resident alien with a valid U.S. Social Security Number residing in the United States. Resident aliens must apply with a cosigner who is a U.S. citizen or permanent resident. The cosigner (if applicable) must be a U.S. citizen or permanent resident with a valid U.S. Social Security Number residing in the United States. For applicants who have not attained the age of majority in their state of residence, a cosigner will be required. Citizens Bank reserves the right to modify eligibility criteria at anytime. Interest rate ranges subject to change. Education Refinance Loans are subject to credit qualification, completion of a loan application/consumer credit agreement, verification of application information, certification of borrower’s student loan amount(s) and highest degree earned.
  4. Loyalty Discount Disclosure: The borrower will be eligible for a 0.25 percentage point interest rate reduction on their loan if the borrower or their co-signer (if applicable) has a qualifying account in existence with us at the time the borrower and their co-signer (if applicable) have submitted a completed application authorizing us to review their credit request for the loan. The following are qualifying accounts: any checking account, savings account, money market account, certificate of deposit, automobile loan, home equity loan, home equity line of credit, mortgage, credit card account, or other student loans owned by Citizens Bank, N.A. Please note, our checking and savings account options are only available in the following states: CT, DE, MA, MI, NH, NJ, NY, OH, PA, RI, and VT and some products may have an associated cost. This discount will be reflected in the interest rate disclosed in the Loan Approval Disclosure that will be provided to the borrower once the loan is approved. Limit of one Loyalty Discount per loan and discount will not be applied to prior loans. The Loyalty Discount will remain in effect for the life of the loan.
  5. Automatic Payment Discount Disclosure: Borrowers will be eligible to receive a 0.25 percentage point interest rate reduction on their student loans owned by Citizens Bank, N.A. during such time as payments are required to be made and our loan servicer is authorized to automatically deduct payments each month from any bank account the borrower designates. Discount is not available when payments are not due, such as during forbearance. If our loan servicer is unable to successfully withdraw the automatic deductions from the designated account three or more times within any 12-month period, the borrower will no longer be eligible for this discount.
  6. Co-signer Release: Borrowers may apply for co-signer release after making 36 consecutive on-time payments of principal and interest. For the purpose of the application for co-signer release, on-time payments are defined as payments received within 15 days of the due date. Interest only payments do not qualify. The borrower must meet certain credit and eligibility guidelines when applying for the co-signer release. Borrowers must complete an application for release and provide income verification documents as part of the review. Borrowers who use deferment or forbearance will need to make 36 consecutive on-time payments after reentering repayment to qualify for release. The borrower applying for co-signer release must be a U.S. citizen or permanent resident. If an application for co-signer release is denied, the borrower may not reapply for co-signer release until at least one year from the date the application for co-signer release was received. Terms and conditions apply.

2.47% – 6.99%3Undergrad
& Graduate

Visit SoFi

2.47% – 6.30%1Undergrad
& Graduate

Visit Earnest

2.51% – 8.09%4Undergrad
& Graduate

Visit Lendkey

3.02% – 6.44%2Undergrad
& Graduate

Visit Laurel Road

2.48% – 6.25%5Undergrad
& Graduate

Visit CommonBond

2.79% – 8.39%6Undergrad
& Graduate

Visit Citizens

Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality and will make a positive impact in your life. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print understand what you are buying, and consult a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time. Please do your homework and let us know if you have any questions or concerns.