Here's what the Federal Reserve's 0.75 percentage point rate hike — the highest in 28 years — means for you

Abstract

The Federal Reserve raised its target federal funds rate by 0.75 percentage points at the end of its two-day meeting Wednesday. The latest move is only one part of a rate-hiking cycle, which aims to crush inflation without tipping the economy into a recession. The Fed has no sense for consumers, but this approach could also bring relief, says Professor Chester Spatt. The Fed last raised rates by 75 basis points in November 1994. For consumers, the move could ultimately bring relief. The move could also brought relief, he says. If you are planning to finance a new car, you should prepare for even higher interest rates in the coming months. "The rates paid by bigger banks are largely unchanged, so where you have your savings is really important," McBride says. The average online savings account rate is closer to 1%, much higher than the average rate from a traditional, brick-and-mortar bank. "One main opportunity" is to buy U.S.