Student Borrowing Calculator | The 8% Rule

In order to successfully manage student debt after you graduate college, you should only borrow an amount that will result, at most, in a loan payment of 8% of your monthly income or salary.

This tool allows you to explore a reasonable borrowing about given potential future salaries by either 1) major or 2) career. Here is how to use it.

To explore by major, go to www.payscale.com/college-salary-report/majors-that-pay-you-back/bachelors and search for the majors you are considering. Then enter the major in “Enter your major or career” box, and salary from the “Early Career Pay” column in “Enter future salary”.

To explore by career, go to www.payscale.com/research/US/Job and search for careers you are considering. Then enter the career in “Enter your major or career” box, and “1-4 Years salary” amount from the “What is the Pay by Experience Level” section in “Enter future salary”.

Then you can create a sample budget and see the powerful magic of compound interest for your savings.