In this guide, we’ll take a look at the current pros and cons of consolidation, including what is probably the most important question: Will it truly save you any money?If you’re pressed for time, here’s a quick summary of the major points I drive home in this guide: The price tag of a college education is more daunting than ever.
That’s because it’s based on the interest rates of the loans you’ll be consolidating.
You’ll pay the weighted average of those rates rounded up to the nearest 1/8th of a percentage point.
According to The College Board, the cost of one year at a private, four-year college has jumped 146% in the past three decades to $31,231, while the cost of a four-year public school has skyrocketed 225% to $9,139.
Those figures are adjusted for inflation — they would be even gaudier if not — and they include only tuition and fees, not living expenses.
Had I not consolidated, I could have been paying 7.14% starting in 2006 and 7.22% in 2007 before rates dipped back down to 4.21% in 2008.