3 Ways Rising Federal Interest Rates Will Affect Your Wallet

The cost of borrowing money has been at record lows ever since the Federal Reserve began slashing interest rates in response to the 2008 credit crisis. The Fed controls the U.S. short-term interest rate–called the federal funds rate– and has set it at almost zero since late 2008. The goal of this action was to encourage more borrowing and spending, and to trigger economic growth and job creation.

Fast forward to today. The Fed’s stimulus efforts are showing noteworthy results, with the US economy showing signs of robust recovery after this month’s solid jobs numbers. In fact, the economy is looking so good that economists are pulling their expectation for a first interest rate increase forward, instead of pushing it back.

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