Amidst the volatile and fluctuating market, students face the financial challenge of taking out student loans to further pursue higher sources of education. As a result, loans and interest rates have increased across the board in all sectors of the market. From year to year, student loan interest rates for subsized and unsubsized loans have increased with no end in sight. With this revelation in mind, researching student loan rates and the volatile market is a must for the upcoming generation of college students.
In the current economic landscape, market conditions don’t suggest decreases in interest and loan rates for the foreseeable future. Students now face the financial burden of taking out student loans while also dealing with increasing financial burdens.
The steady increase in interest rates from year to year not only affects the global market but also students. From 2022-2023 to 2023-2024 federal student loan rates for undergraduate loans have increased from 4.99% to 5.50%.
The consistent increase in the market’s interest rates poses economic challenges for both the investment market and students.
The current market’s increasing interest rates is being studied by students who are currently in universities. Finance and economics student Michael Bender provides insights for the future. “I believe we are already seeing how interest rates are slowing inflation and the economy. Costs for things such as student loans and mortgages will be greater because of the rate hikes,” he shared.
However, Bender also shows a positive outlook for future interest rates. “But I do believe a soft landing is possible if not likely,” he added.
Senior Nathan Musal showed financial and economic understanding of the future of student loans. “Rising interest rates will definitely hurt people taking out college loans over the next few years. For those who already have student loans, they won’t see any impact at all if they have fixed-rate federal loans. If they have variable rate private loans then they might see an impact,” said Musal.
In the 2023-2024 college application process, students must deal with the increased interest rates student loans feature. The .51% increase in student loan rates creates a difficult financial decision students must make.
With the highly fluctuating market and its corresponding increasing loan and interest rates, students must face physical and financial challenges. For most, navigating the economic market is a necessity when applying for college, with the climbing student loan rates, students must navigate the financial sector with the proper knowledge and discretion to make the proper financial decisions.
