00:01
Okay, in this problem, we have a student loan of $22 ,500, and we have a fixed apr of 9 % and it's over 20 years.
00:13
Okay, so the first thing we need to do is find out how much interest we're paying and then how much we have total.
00:20
So the interest is going to be the principal times the rate times the time, all right? so that's going to be 22 ,500.
00:28
So that's going to be 22500 times the rate, which is 0 .09.
00:33
And then times the time, which is 20.
00:35
Okay? so that means that i'm just going to open up my phone calculator, 22500 times 0 .09 times 20.
00:45
And that's going to give me 40 ,500.
00:51
Now, that is how much my interest is.
00:54
So the total amount, i'm going to say my total, it's going to be equal to the sum of those.
00:59
So that means it's going to be, what is that, 63 ,000, 63 ,000.
01:04
Now, we need to see what the most, monthly payment is going to be over 20 years, right? so the total amount paid over.
01:10
So first of all, the monthly payment and the second, the total amount paid over the term of the loan, we just decided that of the total amount, what percentage is paid towards the principal and what's towards the interest.
01:20
So the monthly payment is going to be divided by $53 ,000.
01:24
So i'm going to say the payment is going to be equal to, actually i'm going to say the m for the monthly payment.
01:30
M is going to be equal to 63 ,000 divided by, what is that, 20 years times 12? so that's going to be, what, 2400? yeah, 12 times 2 ,000, so 240, not 2400, but 240.
01:45
So i'm going to put that in my phone calculator, 63 ,000, divided by 240, and that's going to give me 262 .5.
01:54
So 262 .50, oh, since this is dollars and cents...