Economists have been discussing how the Federal Reserve’s interest rate increase will affect various markets, but everyday consumers are often overlooked. Though not necessarily right away, this rate increase can affect the cost of other expenses, including:
When the Fed’s rate goes up, banks find ways to pass their higher borrowing costs along to consumers. We’ve seen mortgage rates increase in recent months, and that’s because the Fed has suggested interest rates are likely to remain on the rise for years. As mortgage rates go up, people are a little less likely to buy a house, and those with fixed-rate mortgages are less likely to refinance.
Credit Card Rates
In contrast to the interest rate on a mortgage, the annual percentage rate (APR) on your credit card can range from 15-20 percent. If your credit card’s APR is variable as opposed to fixed, an increase in the Fed’s interest rate could cause it to bounce by one or two percentage points. And that interest compounds, meaning you pay interest on what you owe and the interest that you have been accumulating on top of that.
Recently, borrowing rates for student loans have been relatively low, but this rate increase will change that for students taking out new debt. With the Fed’s prediction that interest rates will continue to rise, students planning to take out loans from the government within the next few years will face higher payments.
For more effects of the Federal Reserve’s interest rate, continue reading on The New York Times.
As we plan resolutions for the New Year, cybersecurity isn’t typically top of mind. But this year, things are different. High profile hacks, like that of Yahoo, have been dominating headlines throughout 2016 and making us think more about our online security.
The National Cyber Security Alliance recently offered some advice to help us get our online lives in shape for 2017. Their five ‘digital to dos’ are:
- Lock down your login. Usernames and passwords don’t offer enough protection for key accounts like email, banking and social media. Secure accounts with authentication tools like security keys or biometrics.
- Personal information is like money. Value it. Protect it. Just like your finances, it’s important to keep an eye on your personal information. Be mindful of how your information is being collected by apps and websites.
- Own your online presence. It’s smart to limit who you share information with. Set the privacy and security settings on websites and apps to your comfort level.
- Maintain the cybersecurity of your Internet of Things (IoT) devices. These days, fitness trackers, thermostats, and coffee machines can collect personal information. Make sure they are connected to a secure router.
- Do a digital cleanse. Clean up your email, delete or archive old files, and dispose of electronics securely.
“If you implement these five reliable practices, you will enjoy the benefits of connectivity with greater confidence. And, if you can convince your family and friends to do the same, we will all be safer and more secure online in 2017 and in years to come,” said Michael Kaiser, NCSA’s executive director.
Read more on PR Newswire.
This week, AARP released a new Public Policy Institute report focused on the soaring prices of prescription drugs.
AARP studied the prices of 268 brand-name prescription drugs from 2006 to 2015, and the results were jarring. Between those years, the prices of drugs popular among senior citizens rose more than 130 times the rate of inflation. And when it comes to treating a chronic illness, the average annual cost is now more than $5,800, compared to just $1,600 in 2006.
Considering the average older person relies on 4.5 prescription drugs a month, yearly drug costs could exceed $26,000, says AARP. This is particularly alarming, because the average median income of Medicare beneficiaries is just $24,150. Leigh Purvis, director of health services research in AARP’s Public Policy Institute, places blame on the drug makers, but can’t help but notice a larger issue. “There is nothing in the healthcare system to stop it from happening,” she said. “We are never going to be able to get healthcare costs under control as long as drug manufacturers are free to set incredibly high prices and increase them whenever they want.”
Continue reading at The Hill.