Question

Create an amortization schedule–see amortization video. How much student debt will I bear by the time I graduate? What will my student loan payments be?

Answer 1

An amortization schedule is a table that shows the periodic payments on a loan and breaks down the allocation of each payment towards the principal and interest. To calculate how much student debt you will bear by the time you graduate, you need to know the loan amount, the interest rate, and the repayment term. To calculate your student loan payments, you need to know the loan amount, the interest rate, and the repayment term.

Step-by-step explanation:

An amortization schedule is a table that shows the periodic payments on a loan and breaks down the allocation of each payment towards the principal and interest. To calculate how much student debt you will bear by the time you graduate, you need to know the loan amount, the interest rate, and the repayment term. To calculate your student loan payments, you need to know the loan amount, the interest rate, and the repayment term.

Here is an example:

Let's say you have a student loan of $50,000 with an interest rate of 5% and a repayment term of 10 years.

1. First, calculate the monthly interest rate by dividing the annual interest rate by 12: 5% / 12 = 0.4167%.
2. Next, calculate the number of payments by multiplying the number of years by 12: 10 years * 12 = 120 payments.
3. Then, use the loan formula to calculate the monthly payments: P = (r * PV) / (1 - (1 + r)^(-n)), where P is the monthly payment, PV is the loan amount, r is the monthly interest rate, and n is the number of payments. Plugging in the values, we get: P = (0.004167 * 50000) / (1 - (1 + 0.004167)^(-120)) = $528.04.

Therefore, your monthly student loan payment would be approximately $528.04.