Anyone listening to the news or reading print media knows that student loan interest rates are set to double from 3.4% to 6.8% on July 1, 2013. The actual impact of that increase is less widely known.
For students who borrow the average amount of $23,000 and repay their loan over the standard 10 year repayment period, the impact is $4,598.98 in additional interest. That figure uses a repayment model in which the student pays his monthly loan interest that accrues while he is in school.
Student loan interest rates have been at 6.8% before (2006-2008). Regardless of the interest rate, there are 3 steps families can take to minimize the impact of student indebtedness at graduation:
For more information about student loans, look at the student loan calculator at www.finaid.org.
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