As soon as the Fed starts lowering interest rates, many types of consumer loans and savings products will be impacted. Here’s how to make the most of it.
Everything from car loans and mortgages to credit cards will be impacted once the Fed starts trimming its benchmark."If you are a consumer, now is the time to say: 'What does my spending look like? Where would my money grow the most and what options do I have?'" said Leslie Tayne, an attorney specializing in debt relief at Tayne Law in New York and author of"Life & Debt.
For now, top-yielding online savings accounts are paying more than 5% — well above the rate of inflation.a year by moving that money into a high-yield account that earns an interest rate of 2.5% or more, according to a recent survey by Santander Bank in June. The majority of Americans keep their savings in traditional accounts, Santander found, which FDIC data shows are currently
"Timing your purchase to coincide with lower rates can save money over the life of the loan," Tayne said., they've already started to come down from recent highs, largely due to the prospect of a Fed-induced economic slowdown. The average rate for a 30-year, fixed-rate mortgage is now just under 6.5%, according to
, for example, tend to have a variable rate tied to the prime, Treasury bill or another rate index, which means once the Fed starts cutting interest rates, the rates on those private student loans will come down as well.
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