SAVE vs IBR vs PAYE: Which Student Loan Repayment Plan Saves You the Most?

There are four federal income-driven repayment plans, but most borrowers are choosing between SAVE, IBR, and PAYE. Each caps your payment as a percentage of your income — but the percentages, forgiveness timelines, and eligibility rules differ in ways that can mean thousands of dollars difference over your loan life. Here's a direct comparison.

Side-by-Side Comparison

Plan	Payment cap	Forgiveness	Who qualifies
SAVE	5% (undergrad) / 10% (grad) of discretionary income	10–20 years	All Direct Loan borrowers
IBR (new)	10% of discretionary income	20 years	New borrowers after July 2014
IBR (old)	15% of discretionary income	25 years	Borrowers before July 2014
PAYE	10% of discretionary income	20 years	New borrowers after Oct 2011

SAVE: Best for Most Borrowers (When Available)

SAVE offers the lowest payments of any plan — payments for undergraduate-only loans are half what PAYE or new IBR would charge. It also has the most generous poverty line exclusion (225% vs. 150%), meaning more of your income is protected before any payment is calculated. If you have only undergraduate debt and are not pursuing PSLF, SAVE is typically the best option.

Caveat: SAVE is currently subject to legal challenges. If the courts strike it down, borrowers may be moved to PAYE or IBR. Always check studentaid.gov for current status.

IBR: The Safest Long-Term Option

IBR has been around since 2009 and has survived every legal challenge. If you're worried about the stability of SAVE, IBR is the proven alternative. For new borrowers (post-2014), new IBR and PAYE have identical payment amounts — the main difference is that IBR has no income cap to qualify and is more widely available.

PAYE: Best for Graduate Borrowers Pursuing PSLF

PAYE caps forgiveness at 20 years (vs. 25 for old IBR) and caps payments at 10% like new IBR. If you have graduate loans and are not eligible for SAVE, PAYE can offer earlier forgiveness. However, if you have high income relative to debt, PAYE has an income cap: you must have partial financial hardship to enroll.

The PSLF Factor

If you're pursuing PSLF (10-year forgiveness for government/nonprofit workers), the repayment plan matters less — you just need any qualifying IDR plan and to minimize what you pay until forgiveness. In that case, choose whichever plan gives the lowest monthly payment to minimize out-of-pocket spend before the balance is wiped.

Run the Numbers for Your Situation

The right plan depends on your income, family size, loan balance, and loan type. A borrower earning $40k with $30k in debt will get a very different outcome than someone earning $80k with $100k in debt. Our assessment calculates the exact monthly payment under each plan for your specific numbers.

This article is for informational purposes only and does not constitute legal advice.