It was 6.53% for the 2025-2026 school year. What’s your best guess for this school year?

Answer: 6.52% for undergraduate loans in the 2026-2027 school year

Federal Student Aid set the rate for Direct Subsidized and Unsubsidized loans for undergraduates at 6.52% for loans first disbursed between July 1, 2026 and June 30, 2027. Graduate and professional Direct Unsubsidized loans are 8.07%, and PLUS loans are 9.07%.

Questions:

• How do you think this interest rate compares to the interest charged on credit card debt?
• Use a student loan calculator to find out how much interest a college graduate will pay if they have the average student debt of ~$30,000 and a 10-year repayment term.
• Hypothesize: what is one impact of a high interest rate on federal student loans?

Click here for the ready-to-go slides for this Question of the Day that you can use in your classroom.

Behind the Numbers: (Federal Student Aid)

Congress sets federal student loan rates each year using the high yield of the May 10-year U.S. Treasury note auction plus a fixed add-on percentage. For 2026-27 the Treasury note high yield was 4.468% and the add-on for undergraduate Direct loans is 2.05%, which produces the new undergraduate rate of 6.52%. The add-on is larger for other borrowers, 3.60% for graduate and professional Direct Unsubsidized loans and 4.60% for PLUS loans, which is why those rates run higher.

Learn to manage student debt while balancing other tradeoffs in NGPF's award-winning PAYBACK game in the NGPF Arcade. Played more than 3 million times! 

About the Author

Yonathan Tadesse

Yonathan is a Dallas-based Curriculum Designer at NGPF with 12 years of experience as a high school math, college transition, and financial literacy teacher. An award-winning educator, he has a track record of launching innovative programs at the high school level that expand access and opportunity for students. He is a graduate of Emory University and is passionate about advancing financial education for all students. Outside of work, Yonathan loves spending time with his wife and two kids, working out, playing chess and poker, and learning new things.