Borrowing money to pay for college is common, but so is struggling to pay it back.
Around 30% of American adults took out student loans to pay for higher education, according to the Federal Reserve, and 63% of borrowers report having had difficulty making payments on their loans at some point, according to a 2024 Consumer Financial Protection Bureau survey.
But with tuition and mandatory fees costing over $15,000 a year on average at public institutions and nearly $30,000 at private schools after grants and scholarships, according to the most recent National Center for Education Statistics data, loans are impossible to avoid for many students.
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If you are considering student loans to fund your education, there are two primary options: federal or private student loans. Differing interest rates, eligibility guidelines and repayment options between the loan types can affect how quickly you pay off your debt.
The chart below details the differences between these types of loans.
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