Student Loan Interest Rates

Lots of interest (ha ha) in student loan interest rates in the last few days--or at least so it seems to me as I have come across at least one article per day in each of the four wire services I check daily for the last three days.  The short story is, student loan interest rates are at an all time low and are set to double if the U.S. govt does not figure out how to fund the lower interest rate.  Both major parties agree that they want to keep the rates low, but they do not agree on how to fund the rates. 

Folks, get something straight in your heads, subsidized student loans are loans not grants, the current interest rate is kept artificially low by the federal government paying directly for the defaults instead of charging higher interest on the current loans.  8% interest was normal until the last few years and thus the program did not cost the government as much to fund as it does now.  And by the way, the government pays these default bills by taking money we pay in taxes (income, medicare, social security) and reallocating it to student loan programs.  So, we can either have low interest student loans or we can have other programs--money is not available for everything. 

And then, of course, we complain about the educational debt load.  Well, check out the following graphics from an article published today.

  Somehow, for my own two cents, I think it might just be possible for most people who have student loans to pay their student loan debt.  I have mine, I do not blame the cost of education for my debt, in fact I blame no one for my debt.  I have a job I love, a home, a family, and I pay my debts and will for the next 20 years to come.