Interest rates will continue to climb so here's what to do right now.
PHILADELPHIA (WPVI) -- Interest rates on everything from your credit cards to car loans are going up again after the Federal Reserve approved another super-sized rate hike on Wednesday.
Bobbi Rebell, Personal Finance Expert at Tally said, "They indicated that this is not the end and that we will continue to see more Fed rate hikes. And that is what people are concerned about."
Rates for mortgages have already been at the highest level since 2008. Auto loans are higher than they've been since 2012 and credit card rates haven't been this high since the mid-90s.
"That cumulative total of three percentage points means that your credit card rate is now going to be three percentage points higher than it was at the beginning of the year," said Greg McBride, chief financial analyst for Bankrate.
"We've seen mortgage rates more than double, they started the year and 3%. They're now over 6%."
It's a painful pill for consumers to swallow right now, but the Fed is looking at this as a long-term cure for the economy. Rebell said it is raising rates in hopes of tamping down inflation.
"What they want to do is make debt more expensive to slow down the economy and slow down spending."
There are some indications raising rates is working. The housing market has weakened and construction of new homes has slowed. But prices at grocery stores and elsewhere remain sky-high. It does take time to right the economy.
So with all that in mind, McBride has three money moves you need to make right now.
- Pay down debt and in particular, that high-cost credit card debt.
- Boost your emergency savings. Nothing will help you weather economic uncertainty better than having money tucked away.
- Keep making those retirement contributions. You'll look back years from now and be grateful that you did.
"But it's going to continue to be a bumpy road in the markets," said McBride.
McBride also says savers are benefiting but only if you look in the right places. He said you can get a higher return at smaller community banks, credit unions and online banks, which are offering returns as high as 3% on their online savings accounts.