Thu, June 26, 2008
Interest Rates for College Loan Consolidations Drop Next Week
The studentloanconsolidator.com blog noted a while back that new rates for Stafford and PLUS loans have been set; these are based on the Treasury Bill auction rates. There's further information in their Stafford loan blog. Starting July 1st, consolidation loan rates will drop significantly.
Recent graduates who are in their 6-month grace period and who have federal Stafford or PLUS loans that were disbursed prior to July 1, 2006 have the opportunity to consolidate them at 3.60 – 4.21% (Stafford loans) or 5.01% (Parent PLUS loans). The rates will drop by 3%, but it’s too late if you’ve already consolidated your loans.
I’m not a huge fan of debt generally, but borrowing money for a degree that will enhance your earnings power is an investment – you must analyze it in terms of what it’s worth. A really expensive degree needs to raise your income-earning power by quite a bit to be worth getting (in purely economic terms). It may also be valuable in terms of personal fulfillment – but getting a degree in, say, Old Norse Literature will have to fulfill some very, very primal needs....
This question of what a degree is worth is something that I’ve been thinking about recently; I’ve been encouraged by an inquiry from a friend to pursue it in more detail, so expect a future post.
