What Fed Rate Increases Mean for Mortgages, Credit Cards and More

As the Federal Reserve has steadily lifted its key interest rate over the past year, Americans have seen the effects on both sides of the household ledger: Savers benefit from higher yields, but borrowers pay more.
Here’s how rising rates affect consumers.
Credit Cards
Credit card rates are closely linked to the Fed’s actions, so consumers with revolving debt can expect to see those rates rise, usually within one or two billing cycles. The average credit card rate was just over 20 percent as of April 26, according to Bankrate.com, up from around 16 percent in March last year, when the Fed began its series of rate increases.
Car Loans
Car loans tend to track the five-year Treasury note, which is influenced by the Fed’s key rate — but that’s not the only factor that determines how much you’ll pay.
A borrower’s credit history, the type of vehicle, loan term and down payment are all baked into that rate calculation. The average interest rate on new-car loans was 7 percent in March, according to Edmunds, up nearly a percentage point from six months earlier.