Latest news with #collegefunding
Forbes
15-07-2025
- Business
- Forbes
Private Student Loan Rates: July 15, 2025—Loan Rates Start To Increase
Editorial Note: We earn a commission from partner links on Forbes Advisor. Commissions do not affect our editors' opinions or evaluations. Last week, the average interest rate on 10-year fixed-rate private student loans increased. But borrowers interested in pursuing private student loans to make up for a gap in college funding can still score lower rates than this time last year. According to from July 7 to July 12, the average fixed interest rate on a 10-year private student loan was 6.95%. It was 8.58% on a five-year variable-rate loan. That's for borrowers with a credit score of 720 or higher who prequalified on student loan marketplace. These rates are accurate as of the week of July 7, 2025. Related: Best Private Student Loans Last week, the average fixed rate on a 10-year loan rose by 0.65 percentage points to 6.95%. The average stood at 6.30% the week prior. Borrowers currently in the market for a private student loan will receive a lower rate than they would have at this time last year. At this time last year, the average fixed rate on a 10-year loan was 7.48%, 0.53 percentage points higher than today's rate. Let's say you financed $20,000 in student loans at today's average fixed rate. You'd pay around $232 per month and approximately $7,804 in total interest over 10 years, according to Forbes Advisor's student loan calculator. Average variable rates on five-year loans fell last week to 8.58% on average from 14.33%. In contrast to fixed rates, variable interest rates fluctuate over the course of a loan term. Variable rates may start lower than fixed rates, especially during periods when rates are low overall, but they can rise over time. Private lenders often offer borrowers the option to choose between fixed and variable interest rates. Fixed rates may be the safer bet for the average student, but if your income is stable and you plan to pay off your loan quickly, it could be beneficial to choose a variable loan. Financing a $20,000 five-year private loan at 8.58% would yield a monthly payment of approximately $411. A borrower would pay $4,666 in total interest over the life of the loan. But the rate in this example is variable, and it could move up or down each month. Before you look to a private student loan, consider a federal student loan as your first option. The interest rates on federal student loans are generally lower. Federal student loans also tend to have far more generous repayment and forgiveness options. Yet, if you've reached the borrowing limits for federal student loans or if you're ineligible for them, private student loans can be a good solution. When shopping for a private student loan, you'll generally need to apply directly through a non-federal lender. This includes banks, credit unions, nonprofit organizations, state agencies, colleges and online entities. It's important to note that you'll need a qualified co-signer if you have limited credit history, as undergraduates often do. When applying for a private student loan, take into consideration the following: Your qualifications. Private student loans are credit-based. Lenders typically require a credit score in the higher 600s. This is where having a co-signer can be particularly beneficial. Private student loans are credit-based. Lenders typically require a credit score in the higher 600s. This is where having a co-signer can be particularly beneficial. Where to apply. You can apply directly on the lender's website, via mail or over the phone. You can apply directly on the lender's website, via mail or over the phone. Your options. Look at what each lender offers and compare the interest rate, term, future monthly payment, origination fee and late fee. Also, check to see if the lender offers a co-signer release so that the co-borrower can eventually come off of the loan. The first step in finding the best private student loan is to take a look at the loan's overall cost. Consider both interest rate and fees. Also, look at the type of help each lender offers if you're not able to afford your payments. Remember, those with good or excellent credit typically get the best rates. How much should you borrow? Experts generally recommend borrowing no more than you'll earn in your first year out of college. How much can you borrow? Some lenders cap the amount you can borrow each year, while others don't. When you're shopping around for a loan, talk to lenders about how the loan is disbursed and what costs it will cover. If you need to borrow for school, federal student loans are generally the best option. This is because federal loans offer various borrower protections, such as access to income-driven repayment plans and student loan forgiveness programs. Additionally, most federal loans don't require a credit check or co-signer. The rate you receive depends on whether you're getting a fixed or variable loan. Rates, in part, are based on your credit profile. Those with higher credit scores often get the lowest rates. But your rate is based on other factors as well. Income and even the degree you're working on and your career can play a part. While private student loans shouldn't necessarily be your first financial aid option, they can come with a variety of benefits, including the following: You can often borrow as much as you need. Some private lenders let you borrow up to your school-certified cost of attendance, minus any previously awarded financial aid. Some private lenders let you borrow up to your school-certified cost of attendance, minus any previously awarded financial aid. You might not have to pay fees. The best private lenders don't charge origination or disbursement fees, so you won't have extra charges on your loan in addition to interest. The best private lenders don't charge origination or disbursement fees, so you won't have extra charges on your loan in addition to interest. Good credit means better interest rates. While your credit score doesn't matter with most types of federal student loans, it does impact private borrowing. Lenders often offer competitive rates to borrowers with excellent credit or a creditworthy co-signer . While your doesn't matter with most types of federal student loans, it does impact private borrowing. Lenders often offer competitive rates to borrowers with excellent credit or a . It's easy to apply online. Applying for a private student loan is often a quick online process that you can do at any time throughout the school year. Many lenders also let you prequalify for loans online, making it easy to shop around and compare offers from multiple banks. Applying for a private student loan is often a quick online process that you can do at any time throughout the school year. Many lenders also let you prequalify for loans online, making it easy to shop around and compare offers from multiple banks. International students may be eligible. Some lenders provide loans for international students attending school in the U.S. If you're an international student, you may have to apply with a U.S.-based co-signer to qualify. Some lenders provide loans for international students attending school in the U.S. If you're an international student, you may have to apply with a U.S.-based co-signer to qualify. Your lender may offer useful perks. Depending on the lender, you may qualify for some, from interest rate discounts to cash-back bonuses. Some offer a range of repayment terms, lengthy grace periods, forbearance and deferment options and other borrower protections.
CBS News
14-07-2025
- Business
- CBS News
Federal vs. private student loans: Which borrowing option makes more sense this fall?
As the new academic year approaches, students and families across the country are scrambling to finalize their college funding plans. Tuition, housing, books and fees can add up quickly, though, so even the families who've saved diligently to cover the costs of higher education may find themselves turning to student loans to fill in the gap. And in today's high-rate environment, deciding what route is best for borrowing that money is perhaps more important than ever. In general, the student loan landscape offers two main paths: federal student loans, which are backed by the government, and private student loans, which are issued by banks, credit unions and other financial institutions. Each option comes with its own set of benefits, drawbacks and eligibility requirements that can have a big impact on the total cost of your loans and the repayment process, so it's important to choose wisely. What makes this decision particularly challenging is that the "right" choice varies based on factors like your financial situation, credit history, career goals and risk tolerance. So, how exactly can you decide which student loans are the right option for you this fall? Find out how affordable the right private student loans could be today. Federal vs. private student loans: Which borrowing option makes more sense this fall? For many students, the choice between federal and private student loans isn't necessarily an either-or decision. That said, it makes sense in most cases to start by exhausting all federal student loan options first. That's because federal loans come with protections and benefits you won't find in the private lending market. For example, federal loans offer fixed interest rates that apply to all borrowers, regardless of credit history, which can be a big advantage for students who haven't yet built a financial track record. Right now, rates are 6.39% on new undergraduate federal loans disbursed between July 1, 2025, and June 30, 2026. Rates on federal loans for graduate students are 7.94%, and rates for parents or graduate students taking PLUS loans are 8.94% for the 2025-2026 school year. And, there are other unique benefits of opting for federal student loans, like income-driven repayment plans and options for deferment, forbearance and even loan forgiveness under certain circumstances. These features can make repayment more manageable after graduation, especially if your income is low or unpredictable at first. However, federal student loans also come with strict borrowing limits, especially for undergraduates. For dependent students, annual loan limits range from $5,500 to $7,500, depending on your year in school. That may not be enough to cover the full cost of attendance, particularly at private colleges or out-of-state schools. This is where private student loans can fill the gap. Private loans, offered by banks, credit unions and online lenders, don't have the same strict borrowing caps, and the rates on private loans can be much lower than federal loan rates. You can typically borrow up to the full cost of attendance, minus any other financial aid you've received. Private lenders also offer a variety of interest rate options, including fixed and variable rates, as well as choices for repayment terms. Still, private loans aren't as flexible as federal loans. Most lack income-driven repayment plans and forgiveness programs, and some require a co-signer if you don't have a strong credit history. Interest rates can also vary widely based on a range of factors, which means some borrowers could end up paying much more than they would with federal loans. The key is to carefully balance these two loan types: use federal loans as your foundation and consider private loans only to bridge any remaining funding gaps. Learn more about the student loan options and rates available to you now. How to choose the right student loan mix for your situation Before taking out any type of loan, make sure you've tapped into all "free money" sources, like grants, scholarships and work-study programs. Once you've done that, follow these steps to figure out the best loan strategy for you: Start with your financial aid package: Review the federal loans offered as part of your school's financial aid award. Accept subsidized loans first, since the government pays the interest while you're in school. Then consider your unsubsidized loan options, which accrue interest from the start. Calculate your funding gap: Compare your total cost of attendance, including room, board, books and other expenses, with the aid you've already secured. The difference is the amount you may need to cover with private loans or family contributions. Shop around for private loans: If you decide to pursue private loans, be sure to compare multiple lenders. Look for competitive interest rates, flexible repayment options and any borrower protections they offer. Some private lenders also provide perks like interest rate reductions for setting up autopay or releasing a co-signer after a certain number of on-time payments. Consider your future repayment ability: Be realistic about your earning potential in your chosen field after graduation. Private loans can be a useful tool, but they lack the safety net of federal loans if you struggle to make payments down the line. The bottom line Federal student loans are generally the smartest first step when borrowing for college, thanks to the borrower-friendly features and protections these loans come with. But with federal loan limits often falling short of actual college costs, private student loans can help bridge the gap if used carefully. So, as you prepare for the fall semester, take stock of your financial situation, weigh the pros and cons of each loan type and aim to borrow only what you truly need. That way, you can ensure that you're able to pay for the costs of college without compromising your future.
CBC
09-07-2025
- Business
- CBC
Cuts at Ontario colleges leading to nearly 10,000 job losses, union says
The Ontario Public Service Employees Union says close to 10,000 college faculty and staff have either been let go or are projected to lose their jobs amid hundreds of program cancellations and suspensions since last year. The union representing some 55,000 college faculty and support staff says that amounts to "one of the largest mass layoffs in Ontario's history" as colleges grapple with a funding crisis. An arbitrated faculty contract between the union and the College Employer Council released last week says the federal government's cap on international students led to a dramatic decline in enrolment and tuition revenue, and the cancellation or suspension of more than 600 college programs. The document shows 23 of 24 colleges in Ontario have reported a 48 per cent decrease in first-semester enrolment of international students from September 2023 to September 2024. It says 19 colleges have reported current and planned staff reductions totalling more than 8,000 employees as of June, noting the data was incomplete as some colleges hadn't reported their layoffs. The union says the layoffs and program suspensions will have generational impacts and college workers are prepared to fight back against the cuts.
Yahoo
21-06-2025
- Business
- Yahoo
'I Don't Need Millions—Just $300K' People Motivated To Retire Early Share The Smallest Amount Of Money They Consider 'Life-Changing'
In the world of FIRE—that's short for financial independence, retire early—there's a lot of talk about hitting the $1 million mark. Some aim for more, especially with inflation, rising home costs, and uncertain market returns. But one Reddit user posed a simple question that cut through the big goals and got people thinking smaller: "What is the smallest amount of money that would be life changing?" They followed it up with a scenario many can relate to: "If you were gifted x amount, how would it change your life? To get you closer to a FIRE lifestyle. For example, I often think, if I 'just had an extra $300k' I could pay off my house and change to part time work." Don't Miss: Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — Peter Thiel turned $1,700 into $5 billion—now accredited investors are eyeing this software company with similar breakout potential. Learn how you can That number—$300,000—struck a chord. It wasn't just a wild estimate. It was practical, down-to-earth, and repeated over and over. One user wrote: "$300k would be the number for life changing for me and my family." They explained exactly why: "That would mean the last little bit of school debt goes away, selling our current home and moving out of town a ways to a property with at least an acre of land. It means college savings for kids, a little bit of padding to retirement, and two newer used vehicles that aren't 10+ years old." They added, "I could do all that, probably with a few bucks left over." Another put it bluntly: "I don't need millions, just $300k." Trending: Maximize saving for your retirement and cut down on taxes: . Others went slightly higher. One user said, "$300-400k is probably what it would take for me to seriously reconsider any of my current plans." One response pegged the minimum closer to $400,000. "Anything less would be great but not life changing." That amount, they said, would allow both partners in the household to semi-retire permanently. There were some who shot higher. One said they'd need at least $1 million post-tax to feel a real shift in their life. Someone else responded that $500,000 would still mean five more years of work, and only $1 million would bring their timeline closer to two. A few were stuck in a limbo of liquid assets and fear. One user said they had $120,000 nearly liquid but were still too scared to buy a home. Another said, "$60,000 would be enough for me to make a down payment on a house, which feels like the next big step in life." But they also admitted, "I have 100k saved in the stock market, and I'm just so attached to it at this point."The answers were scattered across the map—from $100 for a babysitter and a nice dinner out to $3 million for a stress-free early retirement with part-time work on the side. But $300,000 kept coming up. Not as a dream number, but as a number that felt real enough to change everything—without making anyone rich. As one person summed it up: "10k would just be debt. $100 would be a babysitter and a nice dinner out for my wife and I." So maybe the real benchmark for FIRE isn't just hitting a fat portfolio number. Maybe it's about figuring out what would let you breathe, slow down, or finally move out of a rental and onto your own land. And for a surprising number of people chasing early retirement, that number isn't seven figures—it's $300,000. Read Next: Image: Shutterstock UNLOCKED: 5 NEW TRADES EVERY WEEK. Click now to get top trade ideas daily, plus unlimited access to cutting-edge tools and strategies to gain an edge in the markets. Get the latest stock analysis from Benzinga? APPLE (AAPL): Free Stock Analysis Report TESLA (TSLA): Free Stock Analysis Report This article 'I Don't Need Millions—Just $300K' People Motivated To Retire Early Share The Smallest Amount Of Money They Consider 'Life-Changing' originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved.
Yahoo
07-06-2025
- Business
- Yahoo
Should I Prioritize My 529 Plan or Focus on Other Savings Opportunities for My 16-Year-Old's Education?
There are benefits to saving for retirement in a 529 plan. Because these plans impose penalties for non-educational withdrawals, you may want to limit how much money you put into one. Brokerage and savings accounts could be a viable alternative to a 529. The $23,760 Social Security bonus most retirees completely overlook › As always, The Motley Fool cannot and does not provide personalized investing or financial advice. This information is for informational and educational purposes only and is not a substitute for professional financial advice. Always seek the guidance of a qualified financial advisor for any questions regarding your personal financial situation. If you'd like to submit your question for feedback, you can do so here. If the idea of paying for college is just about as overwhelming as boarding a plane to skydive out of, you're not alone. U.S. News & World Report puts the average cost of tuition and fees at a whopping $43,505 for private colleges. For out-of-state students at public colleges, that number is considerably lower at $24,513. And for in-state public college, tuition and fees are $11,011 on average based on data from the most recent academic year. But even the "cheapest" of these options is one you might need to save diligently for, especially if you have multiple children. And while you might think that it pays to put all of your college savings into a 529 plan, you may want to explore other options, too. Recently, a Reddit (NYSE: RDDT) poster asked if they should be saving all of their money in a 529 plan for their 16-year-old's education, or if they should be branching out. They already have an impressive $70,000 balance in a 529, but they're not sure what other savings vehicles they should focus on in the next two to three years. What is your target 529 balance?byu/Urbanttrekker inMiddleClassFinance Thankfully, the poster is already saving 25% of their income for retirement. They're putting 5% into the 529 and another 10% into what they call "undefined savings." They're set with their emergency fund and have no debts aside from a low-cost mortgage they're eight years from paying off. There's nothing wrong with the poster continuing to save for college in the next few years. But they may want to look outside of a 529 plan. Although 529 plans offer the benefit of tax-free gains and withdrawals, they can reduce the amount of financial aid students get. These plans generally won't have an impact on merit-based scholarships, and they tend to have less of an impact on aid if the parent owns the account, not the student. But that's something to keep in mind. The other issue is that withdrawing 529 funds for non-qualified education expenses generally results in a 10% penalty on the gains portion of those funds, plus taxes on the gains portion of the withdrawal. Now thanks to the SECURE 2.0 Act, it's possible to roll up to $35,000 of unused 529 plan funds into a Roth IRA without incurring taxes or a penalty. So that is one way to deal with an overage. Another option is to designate the extra funds for a different beneficiary – if one exists. The Reddit poster above only makes mention of one child. So designating a different beneficiary may not be a viable solution. It's great that this Reddit poster wants to continue saving for their child's education even after having done such a great job already. But since they already have a fair amount of money in a 529 plan, they may want to branch out and put their remaining college savings elsewhere. One option to consider is a taxable brokerage account. The money in there won't grow tax-free as is the case with a 529. The benefit, however, is flexibility. The poster's child may not end up needing more money for college than what's already been saved. Rather than deal with the headache of having to figure out a plan for excess funds, putting the money into a brokerage account makes it available for any purpose at any time without restriction. The poster could let their child use that money to buy a car or fund a move to a new city after college. Another option is to look at a high-yield savings account. This isn't a great option when you're dealing with a long investment window. But the poster's child is 16, which means college may be just a couple of years away. If they want a safe, stable home for that money without taking on the risk of stock market fluctuations, a high-yield savings account fits the bill. And thanks to today's interest rates, it's not like a high-yield savings account won't earn any money. Saving for a child's education is a great way to avoid having them graduate with a pile of debt. It could make sense to use a 529 plan for the tax benefits involved, but that's not the only account you should consider – especially if you're nearing the point where your child is headed to college and you want to minimize some of your risk. If you're like most Americans, you're a few years (or more) behind on your retirement savings. But a handful of little-known could help ensure a boost in your retirement income. One easy trick could pay you as much as $23,760 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Join Stock Advisor to learn more about these Backman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Should I Prioritize My 529 Plan or Focus on Other Savings Opportunities for My 16-Year-Old's Education? was originally published by The Motley Fool Sign in to access your portfolio
