The cost of federal student loans will be more expensive.
The government sets annual interest rates on student loans every year, but this year’s increase was bigger than expected.
Starting on July 1, interest rates on new undergraduate loans will go from 4.45 percent to 5.05 percent.
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Parent Plus loans are going from 7 percent to 7.6 percent.
"What this means for people taking out loans for their education is an increase over a 10-year period of time could be $1,000, $2,000, $3,000, $4,000," said financial expert Steve Ringo.
He said students and parents should estimate their monthly payment and figure out how long it’s going to take you to start paying it off.
This increase doesn’t affect existing loans, just the ones that will be issued starting July 1.
For more information on how to plan, click here.