How Interest Rates Affect You

Interest rates can have a huge impact on your finances, especially if you carry a lot of debt. Here’s some important information that can help you manage your money more successfully: 1. Credit cards. When the Federal Reserve raises rates, expect to pay more. It’s best to pay off your credit card debt, or switch to a card with a lower interest rate, Go to www.cardweb.com for credit card rates. 2. Home-equity line of credit. You can use your home-equity line of credit if you can pay off the amount you borrow within three years. If you’re unable to pay off the amount in three years, obtain a home-equity loan with a fixed rate. Go to www.bankrate.com for bank rates. 3. Mortgages. If you have an adjustable-rate mortgage you may pay more as rates go up. Financials advisors recommend an adjustable-rate loan with a five or seven-year fixed period. 4. Bonds. When rates go up, generally the yields on most bonds go up. For your protection, invest in funds that hold Treasury and high-quality corporate bonds.