Federal Rate Hikes and How They’ll Impact Your Wallet

If you’ve been paying attention to the news, you certainly know that inflation is running pretty hot. To combat this, the Federal Reserve has chosen to hike interest rates – specifically, the federal funds rate.

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[{"selector":"#anim-f089025e-1b18-4a77-9722-21fd55a12366","keyframes":{"opacity":[0,1]},"delay":0,"duration":2400,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] [{"selector":"#anim-ae0017cd-0936-4d10-b84f-cd2a0c67009d","keyframes":{"transform":["translate3d(0px, -99.4978%, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":2400,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] But how does that work? And what is that rate? Toni Nasr, is a fintech analyst at Investing in the Web. He is a Chartered Financial Analyst (CFA) and a Financial Risk Manager (FRM) with a background in the banking field and in investment research. Read More

In this post, he’ll uncover what the federal rate hike really means for Americans, why these numbers continue getting worse, how this can impact your wallet, and finally, what you can do about this to make money.

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Federal Rate Hikes and How They’ll Impact Your Wallet

Known as the “Federal Funds Rate FFR”, the federal rate is the rate at which banks and other depository institutions lend money to each other on an overnight basis.

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The Fed rate directly affects your wallet on many levels, such as your deposits, loans, credit cards, and mortgages with variable rates. A higher rate is good for savers but challenging for borrowers.

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Why Has the Fed Increased Interest Rates?

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Savers take a hit when the Fed lowers its rates as their money at the banks will earn less, and they will likely want to invest elsewhere to get better returns.

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On the other hand, a benefit of the Fed rate increase is the higher interest rate you earn on your savings accounts. This is because banks and depository institutions link the rate on deposits directly to the Fed Rate.

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Federal Rate Hikes and How They’ll Impact Your Wallet

If you’ve been paying attention to the news, you certainly know that inflation is running pretty hot. To combat this, the Federal Reserve has chosen to hike interest rates – specifically, the federal funds rate.

In this post, he’ll uncover what the federal rate hike really means for Americans, why these numbers continue getting worse, how this can impact your wallet, and finally, what you can do about this to make money.

Federal Rate Hikes and How They’ll Impact Your Wallet

Known as the “Federal Funds Rate FFR”, the federal rate is the rate at which banks and other depository institutions lend money to each other on an overnight basis.

What is the Federal Rate?

The Fed rate directly affects your wallet on many levels, such as your deposits, loans, credit cards, and mortgages with variable rates. A higher rate is good for savers but challenging for borrowers.

How Does It Work and Impact Our Wallet?

Why Has the Fed Increased Interest Rates?

Savers take a hit when the Fed lowers its rates as their money at the banks will earn less, and they will likely want to invest elsewhere to get better returns.

How Does the Rate Increase Affect Savers?

On the other hand, a benefit of the Fed rate increase is the higher interest rate you earn on your savings accounts. This is because banks and depository institutions link the rate on deposits directly to the Fed Rate.

SWIPE UP NOW TO READ MORE

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