$200K in Student Loans: 7 Steps for Paying Off Student Loan Debt

Melanie LockertUpdated August 14, 2025

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March 2025: The Saving on a Valuable Education (SAVE) Plan for federal student loan repayment is on hold due to a court injunction. As of late March, these loan repayment plans are available: Income-Based Repayment, Pay As You Earn, and Income-Contingent Repayment. Federal student loan consolidation applications are also live. To monitor the latest decisions on federal student loan plans, check the Federal Student Aid site.

You took out student loans to pursue your dream of going to college and getting a degree in the field of your choice. Maybe you’ve obtained a graduate degree — and now you have $200K student loan debt.Having six figures of student loan debt can feel insurmountable. In this guide, find out how to pay off $200,000 in student loans.

When Student Debt Is in the Six Figures

According to StudentAid.gov, there are 42.5 million federal student loans borrowers. Out of that total, as of Q1 2025, 1.1 million federal student loan borrowers owe $200K in student loan debt or more.If you’re in this boat, it can feel stressful. Below is how to make student loan repayment possible.

7 Steps for Paying Off $200K Student Debt

Figuring out how to pay off $200K in student loans can feel out of reach, but following these seven steps can help you create a plan to get started:

Step 1: Find Out Exactly How Much You Owe

Although you may know your student loan balance is $200,000, the actual balance is likely different due to interest. Additionally, if you took out different types of loans, you want to know how your total debt is divided up between private and federal student loans.

Federal Loans

To review your federal loan balance, you can check with your loan servicer. You can also sign into your Federal Student Aid account on StudentAid.gov. Federal student loans come with a variety of repayment plans plus forgiveness options. If you’re not sure who your federal loan servicer is, StudentAid.gov can help.

Private Loans

Private student loans don’t come from the U.S. Department of Education. Generally, they’re offered by online lenders and other private financial institutions. To find out how much you owe in private loans, log in to your account to see your balance. If you forgot who your lender is, check your monthly statement or request your free credit report from AnnualCreditReport.com to identify the lender.

Step 2: Create a Budget

Tackling $200K student loan debt isn’t an easy feat. To understand what you’re working with and how you can put more toward your monthly payments, create a budget. As part of this process:

Review take-home pay
Look at monthly, quarterly, and annual expenses
See what expenses you can get rid of or lower
Allocate an amount for each budget category
Don’t forget to include monthly debt payments, plus savings and retirement
Monitor your spending to see if you’re on track with your budget

A budget helps you understand how you’re spending your money. It can also show you how much you have left over so you can put the extra amount toward your loan balance.

Step 3: Increase Income

Unfortunately, there are no shortcuts to paying off $200,000 in student loans and one of the things you likely need to do aside from budgeting and managing expenses is to increase your income.Earning more can mean having more funds available to pay off student loan debt. Some options to increase income include:

Negotiating your current salary
Seeing if you can work over-time or on holidays for additional pay
Getting a side hustle like dog walking via Rover, freelancing using your existing skills, working catering for events, and more

Negotiating your salary may feel scary but it’s the easier way to earn more and get paid for what you’re currently doing. If taking on a side hustle, evaluate your skills, and the time and energy you have available.

Step 4: Prioritize High-Interest Student Loans

Paying off a student loan is tough, especially because of the interest that accumulates. If you took out Grad PLUS Loans for a graduate or professional degree, it’s likely you have a high interest rate. PLUS Loans have the top rates compared to other federal loans. When you look at how much you owe and the various student loans you have, look at the interest rates. By focusing on repaying high-interest loans first, you can lessen the amount of interest that grows. This strategy is called the debt avalanche method. Pay all of your minimum monthly payments, and throw extra available funds toward the loan with the highest rate. Continue through this process until all your loans are paid off.

Step 5: See if You Qualify for Any Kind of Student Loan Forgiveness

Feeling like $200K in student loans is simply too much? If they’re all or mostly federal loans, you can look into loan forgiveness options.

Public Service Loan Forgiveness (PSLF)

Public Service Loan Forgiveness is designed for workers in the public sector. Federal loan borrowers who work for an employer like a nonprofit or federal government agency may qualify. You must make 120 payments and serve for 10 years. At the end of that timeframe, you can apply for PSLF and get all remaining loans wiped out, tax-free.

Student Loan Forgiveness for Healthcare Professionals

Did you get $200K student loan debt from going to medical school? Healthcare professionals such as doctors, nurses, and more may be eligible for certain medical school loan forgiveness programs.States may offer loan repayment programs for healthcare professionals who are willing to work in a rural area and serve for a period of time.

Student Loan Forgiveness for Teachers

Teachers may be able to score up to $17,500 in student loan repayment cancellation via the Teacher Loan Forgiveness Program. To qualify, you need to work at an eligible school and serve for five years on a full-time basis.

Step 6: Look Into Different Kinds of Repayment Plans

The $200K student loan monthly payment can feel like a huge burden. It might feel like you have no money left over for other expenses or you have to make tough financial decisions. In that case, it makes sense to look into different repayment plans.

Income-Driven Repayment (IDR) Plans

Federal loan borrowers trying to figure out how to pay off $200K in student loans can look into lowering payments through an income-driven repayment plan. The U.S. Department of Education now offers the following three IDR plans to help borrowers pay down their federal student loan debt:

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

The PAYE and ICR plans are set to close soon, so you may consider switching to IBR. Starting in the summer of 2026, there will also be a new Repayment Assistance Plan (RAP) with its own set of guidelines. Those who borrow student loans after July 1, 2026 will only have access to RAP or a new Standard Repayment Plan. Private student loans are not eligible for any federal repayment options, including IDR plans. Depending on your income and family size, IDR plans may offer a lower monthly payment compared with the Standard Repayment Plan.IDR plans can end with a borrower’s outstanding balance being forgiven at the end of the 20- or 25-year repayment period. However, forgiveness is on pause indefinitely for PAYE and ICR. It's also on pause for IBR, but should resume after the Education Department finishes updating its systems. If you were on PAYE, ICR, or the now-defunct SAVE plan, you can switch to IBR and your payments on those plans will count toward your loan forgiveness progress. Be aware that depending on the tax law at the time, this type of forgiveness may come with tax consequences.

Student Loan Deferment

Borrowers seeking temporary relief can consider student loan deferment as a temporary option. This way you can put monthly payments on hold for a period of time. However, this is more of a band-aid and not a long-term solution. Going on an IDR plan may be better for the long term.What's more, deferment for unemployment and economic hardship will no longer be available for loans made on or after July 1, 2027.

Step 7: Consider Refinancing to a Lower Rate

Paying off $200K student loan debt is a lot and with the average student loan interest rate, it can grow quickly.To make matters worse, you’re stuck with your loan servicer and your interest rate. One way to change things up and obtain a lower rate is through student loan refinancing. Refinancing lets the borrower apply for a new loan that may have a better rate and different terms.

Pros and Cons of Refinancing Private Student Loans

Here are some of the pros and cons of refinancing private student loans.

Pros:

May save money on interest with a lower rate
You can sign up for a different term that can change your monthly payment that fits your needs

Cons:

You must qualify and generally have good credit to obtain a lower rate (or apply with a cosigner)
May need to have a certain income to qualify

Pros and Cons of Refinancing Federal Student Loans

Student loan refinancing is much riskier for federal loan borrowers. Federal loans have income-driven repayment plans plus certain programs for forgiveness. Refinancing turns these federal loans into a new private loan. In other words, you’ll miss out on these important protections. Here are some of the pros and cons of refinancing federal student loans.

Pros:

Potentially lower interest rate
You can refinance for a shorter term length to save on interest

Cons:

No longer qualify for Public Service Loan Forgiveness or Teacher Loan Forgiveness
Income-driven repayment isn’t available

The Takeaway

Having $200K student loan debt can feel heavy and greatly impact your financial life. Getting a hold on your numbers and maximizing your budget and boosting income can help.Of course, pursuing forgiveness through programs you’re eligible for can be a huge relief. If that’s not an option or route you’re considering, you can also lower the rate through refinancing. Keep in mind, though, that refinancing federal student loans means forfeiting access to federal repayment plans, forgiveness programs, and other benefits. Taking these steps can help you map out how to pay off $200K in student loans.

Frequently Asked Questions

Is $200,000 in student loans a lot?

Is there a maximum amount of student debt you can have?

Can you get $200,000 in student loans forgiven?

Photo credit: iStock/FG Trade

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About the Author

Melanie Lockert

Melanie Lockert is the founder of the blog and author of the book, Dear Debt. Through her blog, she chronicled her journey out of $81,000 in student loan debt. Her work has appeared on Business Insider, VICE, Allure, and more.

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