You make your student loan payments every month, for years. Yet when you look at your balance, it doesn’t seem like it has decreased at all. In fact, it seems to keep going up.

Many factors determine how much your student loan payment actually cuts into your debt. Knowing the following five things about how payments are applied is the only way you can ensure your repayment strategy is as effective as it can be.

[Here are five things to know about your student loan report.]

1. How often interest accrues on your loans: Here’s the bad news: Interest accrues every single day that most federal student loans are outstanding. Subsidized Stafford and Perkins loans generally do not accrue interest during in-school, grace and deferment periods. However, some newer Stafford loans will accrue interest during their grace period. Borrowers who took their first loan on or after July 1, 2013 run the risk of losing their subsidy if they take a long time to complete their credential.

The good news is that like most consumer debts, interest only accrues on the outstanding balance. So the more quickly you pay it off, the less you pay in interest over the life of the loan. That also means that the majority of your monthly payment goes toward interest in the first few years of repayment.

2. When your interest is capitalized: Interest on student loans is capitalized – meaning it's added to the principal balance – at various times. While the rules differ slightly depending on when you took your loan out and what type of loan it is, expect outstanding interest to capitalize any time your loan goes from a nonrepayment status, such as grace or deferment, to a repayment status.

You always have the option to pay that interest before it capitalizes, which is a must if you want to avoid having interest charged off of interest.

3. How loan holders apply your payments: The government regulates the way loan holders apply your payments. When loan holders receive your payment, they must credit your funds in the following order: first, they pay any fees associated with the loan, such as late fees; second, they apply funds to the interest that has accrued to date; third, any remaining funds go toward the principal of the loan.

Here’s a quick example to illustrate how this works. Say you have a $1,000 loan at 5 percent interest placed on a standard 10-year term, with payments made approximately every 30 days.

Day one, you have $1,000 in principal and $0.14 interest. Day two, $1,000 interest and $0.28 interest and so on until day 30, when you have $1,000 principal and $4.20 in interest. On day 30, the loan holder receives your $50 payment. You don’t owe any late fees, so first they pay off the interest that has accrued and the remaining $45.80 goes toward the principal.

So, now your principal is $954.20 with $0 in interest. That means the principal balance is lower, so you’ll only accrue about $0.13 in interest per day going forward.

4. What happens if you pay extra: Federal regulations require a loan holder to push the next payment due date up for every multiple of the monthly payment they receive. So, if your payment of $50 is due in October and you send them $100, your next payment isn’t going to be due until December.

You can submit or call in instructions to not have the payment due date pushed up, but doing so will not change the way the funds are actually credited to your account. It really only makes a difference if you pay with automatic​ electronic payments, because if you pay ahead, the loan holder won’t pull a payment for the following month.

Remember, you can’t prepay interest that hasn’t accrued yet, which is why if you pay extra every month, the amount of money going to the principal will be the same even if the lender pushes your due date ahead.

5. Keeping track of your own payments: If you want to see how much of your payments go to your principal, most loan servicers allow you to log on and view a breakdown of your payment history, which includes how the payments were applied to principal and interest. If not, you can ask for one to be sent to you.