Consumer Reports – July 31, 2015
David Schneider was recently featured in a Consumer Reports article on how to minimize the impact of rising interest rates on your finances.
In the article he suggested borrowers tap their home equity line of credit to pay off higher interest credit card debt since “it will almost certainly be at a lower interest rate, and I’d rather pay 4 percent than 14 percent,” noting you should only employ this strategy if you are certain of your ability to pay the loan back, warning that if interest rates ultimately rise by a couple of percentage points “You could be looking at a 50 to 100 percent increase in your payment.”
He also discussed who wins from rising rates, stating that “savers who socked away their money in Certificates of Deposit (CDs) or bank money market accounts will finally catch a break” since “CD rates will go up. Money market account rates will increase. An increase is a win for savers.”
Read more: Consumer Reports