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How to save money while interest rates increase for a third time



On Wednesday, the federal reserve raised interest rates for a third time hoping it will help consumer spending. If that happens the record high inflation could go down, making some commodities less expensive. However, when it comes to loans and payments with interest you’ll be paying more. “That means that a $300,000 mortgage that you would have paid for in January of 2021 would cost you about 50% more per month if you got that the prevailing rates today,” said University of New Mexico Economist Reilly White. The interest spikes don’t just apply to homes. “You’re going to be paying a lot more on cars,” White said. For example, if you’re about to buy a car an auto loan of $35,000 dollars would have cost you about $661 a month earlier this year. Now it would cost you about $673 a month – That’s $144 more a year for the same car. “If you’re looking at a big purchase on the horizon, it’s very hard to always trim interest rates. And sometimes we don’t have the luxury to do those things,” White said. White recommends that during this time you wait to make those big purchases on a home or a car if you can. He says if the feds continue to increase interest rates things will change with time. “When that happens, though, the economy will shift. If we are in a recession. Rates will drop and that will present an opportunity to go out and look at those large purchases again,” White said.

On Wednesday, the federal reserve raised interest rates for a third time hoping it will help consumer spending.

If that happens the record high inflation could go down, making some commodities less expensive.

However, when it comes to loans and payments with interest you’ll be paying more.

“That means that a $300,000 mortgage that you would have paid for in January of 2021 would cost you about 50% more per month if you got that the prevailing rates today,” said University of New Mexico Economist Reilly White.

The interest spikes don’t just apply to homes.

“You’re going to be paying a lot more on cars,” White said.

For example, if you’re about to buy a car an auto loan of $35,000 dollars would have cost you about $661 a month earlier this year. Now it would cost you about $673 a month – That’s $144 more a year for the same car.

“If you’re looking at a big purchase on the horizon, it’s very hard to always trim interest rates. And sometimes we don’t have the luxury to do those things,” White said.

White recommends that during this time you wait to make those big purchases on a home or a car if you can. He says if the feds continue to increase interest rates things will change with time.

“When that happens, though, the economy will shift. If we are in a recession. Rates will drop and that will present an opportunity to go out and look at those large purchases again,” White said.



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