Save your cash. That’s what the Feds want when they raised interest rates again. To combat inflation they raised rates another 3/4 of a point. That means is costs more to borrow money whether it’s a mortgage, auto loan, or credit cards. The higher the cost to borrow money, less likely a consumer will spend less. In other words, save your cash.
If you were debating to renovate your home, you might be thinking twice. Borrowing money to do so is going to cost you more and your renovation is more than it would have been last year. If you were in the market shopping for a new car, auto loan rates have increased which means it’ll cost you more for the car. You may stop and think twice before whipping out the cash.
Spending will slow down which would lead to prices falling because demand goes down. It’s a supply and demand scenario. The less people spend on a product, the likelihood that the price will go down because the demand isn’t has high. This will supposedly help with rising inflation.
Save your cash. Where do you want to stash it? One place is to look at high-yield savings accounts such as Capital One or Marcus by Goldman Sachs. As of writing this post, they are offering 2% and 2.15% respectively. This is a lot higher than the 0.2% it was offering last year.
Investing your money in the stock market is also an option but is at risk for ups and downs of the market. Cryptocurrency is another area to invest in.
Bonds can be beneficial to avoid the ups and downs of the market. Bonds tend to be slow growing but doesn’t have the volatility as a stock would.
The Feds don’t want you spending your money. They want you to save your cash. This is their plan to help bring inflation down. Does the current economic strategy fit with your goals? It’s good to reassess your goals and make good financial decisions. If you are interested in following my journey, email subscribe to get alerts of latest posts or follow me on Facebook, Instagram, and Pinterest.
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