What is considered a lot of student loan debt? A lot of student loan debt is more than you can afford to repay after graduation. For many, this means having more than $70,000 – $100,000 in total student debt.
However, our opinions are our own. See how we rate credit score services to help you make smart decisions with your money. Some experts say any loan above student loan or mortgage interest rates is high-interest debt, a range of about 2% to 6%.
Graduate student and parent PLUS loans have fixed interest rates of 8.08% and 9.08%, respectively. Private student loan fixed interest rates are typically around 4.51-12.63%. Variable interest rates can start as low as 5.37%. Throughout the loan, they can reach 20-30% or more.
To understand where the average personal rate falls within the advertised rates that Investopedia tracks, the range for unsecured loans spans APRs as low as 5.91% to as high as 295%. However, most lenders in our database have a maximum APR below 36%.
Excellent Credit (750+): 3% or lower for new cars, 4% or lower for used cars. Good Credit (700-749): 4-5% for new cars, 5-6% for used cars. Fair Credit (650-699): 6-7% for new cars, 7-8% for used cars. Poor Credit (600-649): 8-10% for new cars, 10-13% for used cars.
A good personal loan interest rate is typically one that's lower than the national average rate, which is 12.17% as of Q3 2023. Because interest rates can vary based on a number of factors, including economic conditions, that average can fluctuate over time.
For new undergraduate loans, the current federal interest rate is 6.53%, the highest of the last decade; the lowest was 2.75%. Federal loans are available to graduate and professional students with an interest rate of 8.08%; parents can borrow PLUS* loans at 9.08%.
Your interest charges will be added to the amount you owe, causing your loan to grow over time. This can occur if you are in a deferment for an unsubsidized loan or if you have an income-based repayment (IBR) plan and your payments are not large enough to cover the monthly accruing interest.
With the average 30-year fixed mortgage rate currently at 7.18% (and the average undergraduate federal student loan rate at a much lower 4.99%), that means you could consider any debt with an interest rate higher than 7.18% as high.
A “good” mortgage rate is different for everyone. In today's market, a good mortgage interest rate can fall in the high-6% range, depending on several factors, such as the type of mortgage, loan term, and individual financial circumstances.
Meanwhile, interest rates are still high, and for homebuyers, this means mortgage rates between 6% and 7% — forcing many to put their plans on hold until borrowing becomes more affordable.
Overall, only 1% of all U.S. adults owed at least $100,000. Young college graduates with student loans are more likely than those without this kind of debt to say they struggle financially.
With $50,000 in student loan debt, your monthly payments could be quite expensive. Depending on how much debt you have and your interest rate, your payments will likely be about $500 per month or more. Your potential savings from refinancing will vary based on your loan terms.
The 10% Rule
Let's say, for example, that your monthly take-home pay is $3,500. Your student loan payment would need to be no higher than $350 to meet this guideline. If you owed $30,000 at a 6% rate, your payments would be $333 on a standard 10-year plan, which would fall within this limit.
The average outstanding federal student loan debt per borrower is $37,853. 52.6% of indebted borrowers owe $20,000 or less in federal student loans. 32.1% of indebted student borrowers owe $10,000 or less in federal student loans. 15.0% of borrowers owe less than $5,000.
On average, people with student loans have spent just over 21 years paying back their loans. Federal student loans offer repayment plans that last from 10 to 30 years. Private student loan repayment terms vary.
Based on our analysis, if you are a man and owe more than $100,000, or a woman and owe more than $70,000, you have high student loan debt and your debt is likely not worth the income you'll earn over your lifetime.
The average private student loan debt for borrowers who earned their Bachelor's degree in 2022-23 was $35,770 per borrower at public institutions and $41,660 per borrower at private institutions.
A good interest rate on a personal loan is anything lower than the market's average rate. But a good rate for you depends on your credit score. For example, if you have excellent credit, a rate below 11 percent would be considered good, while 12.5 percent would be less competitive.
The lowest federal loan rate, 6.53 percent, is available to undergraduate students for the 2024-25 school year. Unsubsidized and Direct Plus loan rates for graduate students currently sit at 8.08 percent and 9.08 percent, respectively.