How rising interest rates could impact you financially | Connecticut News


(WFSB) – Get ready for another hit to your wallet.

The Federal Reserve expects to raise interest rates three times next year.

The plan was announced Wednesday and officials say it’s a way to curb inflation.

Inflation is nearly at a forty-year high and the Federal Reserve is increasing interest rates to slow it down.

Certified financial planner Joel Johnson says if the Federal Reserve can slow the economy down by raising interest, it could prevent prices from going up even more, but that’s going to impact consumers and businesses.

Johnson says credit card payments won’t be affected much.

He says the rate the government sets on student loans will probably go up, but not drastically.

Home loans and 401Ks will likely see the biggest impact.

“Mortgage rates are probably going to go up. If we’re talking this time next year, mortgage rates are probably at least one percent, two percent higher. The stock market will probably pull back a little bit, which means the balances on our 401Ks will probably come back a little bit. No reason to panic. That’s just something to be expected from time to time,” Johnson explained.

There are some benefits. Johnson says the rising interest rates will hopefully normalize prices.

He says, because the economy is hot, there are a lot of jobs available and employees can ask for more.

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