As you know, interest rates have risen considerably over the past couple of years. But what does this mean to you, as a consumer and as an investor?
From a consumer’s standpoint, it’s not hard to see the effects of higher interest rates. If you want to take out a mortgage or refinance an existing one, you’ll find that it’s considerably more costly, in terms of the interest you’ll pay, than it was a few years ago. And the same is true of car loans and credit cards. Paying these debts at higher rates can affect your cash flow, so while rates are high, you may need to make some important decisions about your overall budget and spending plans.
As an investor, though, you may find the effects of higher interest rates to be somewhat more complex. That’s because higher rates can have a different impact on different types of investments, such as stocks and bonds.
