What the Federal Reserve interest rate increase means for you

The long-awaited interest rate hike by the Federal Reserve was finally announced today.  The Fed announced that it would raise rates by a quarter of a percentage point, up from close to zero. While the increase was small, the move was significant.

The last interest rate hike came in mid-2006. The Fed’s decision to lower rates and keep them close to zero for so long was unprecedented. But it made sense. Since 2007, when the country entered a financial crisis, the Fed kept moving rates lower in the hopes of boosting economic activity. The idea was the low rates would allow consumers and businesses to borrow and spend more. Read more

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