The interest rate on new federal student loans is going up.
The government sets annual interest rates on the debt once a year, and the percentage is based on the 10-year Treasury note.
Despite the uptick, rates remain low by historical standards, said higher education expert Mark Kantrowitz.
Although the U.S. Department of Education hasn’t formally announced the new rates for the 2021-2022 academic year, Kantrowitz has calculated what the new figures will likely be. By Kantrowitz’ estimations, the interest rate on federal student loans will climb by 0.98%.
“It is the fourth-lowest interest rate in the last decade,” he said.