Interest Rates Could Be On The Rise

The Fed has recently hinted that they will begin to raise interest rates. This comes after they have already slowly begun to raise interest rates on short term loans. This same principal could then be expanded to longer terms to help meet federal funding demands. Interest rates rising are typically a bad thing for consumers and a good thing for financial institutions that have the ability to lend out large sums of money. Many sources claim that these rise to interest rates could have the biggest influence on home mortgages, car loans, and credit cars. This means that although the sticker prices of these items may not change, the amount of money paid back to lending institutions each month over the period of the loan will undoubtedly increase. As a consumer, this means being more diligent with their budgets because more of their paychecks will have to be set aside to pay off the interest that is accrued on any outstanding loans they have. It is important to note that the interest rates being proposed are still far lower than they were pre-recession. While this may not be enough to entirely break the bank for consumers, it is important to take note of as a potential turning point in the current economic landscape that has largely benefited from years of a bull market. Only time will tell the true changes that these rate hikes will create but it is a better time than ever to beginning planning for what may be ahead.