Article originally published by thehill.com
Written by Tobias Burns
“The Federal Reserve Bank announced a 75 basis point interest rate hike on Wednesday, a 50 percent greater increase than the central bank had initially signaled it was going to make for June.
“The move comes after inflation hit a new, 40-year high last week, with consumer prices reaching an 8.6 percent mantel over where they were a year ago.
“Fed watchers predict that the bank’s benchmark federal funds rate will continue to rise throughout the year, perhaps at a quicker pace than originally expected if higher prices don’t go down.
“Even with the rate hike, interest rates will still only be around 1.6 percent, close to all-time lows.
“Here are five ways that an environment of increasing interest rates will affect Americans’ wallets and the economy:
Mortgage, car and credit card payments are going to increase
“The federal funds rate sets the rate at which banks and credit unions can lend money to each other as they determine their need for capital to make investments across the economy.
“Banks that borrow money at the federal funds rate then need to charge a comparable rate to the people and institutions that borrow money from them. So an increase in the funds rate translates down to higher rates in credit markets, mortgage markets and any industry that relies on financing plans to make payments.
“This means higher monthly house and car payments and a bigger price tag on outstanding credit card debt.
“Mortgage rates are already seeing sharp increases. Interest payments for the U.S. benchmark 30-year fixed rate mortgages made the largest one-week jump in 35 years, hitting 5.78 percent as of Thursday, up more than half a percentage point since only the week before.
“That means a mortgage payment on a median-valued $400,000 home, after a 20 percent down payment, would now be about $1,875 dollars. Last year, the monthly payment on the same home would have been $1,335. That’s more than a $500 per month difference.”
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Megan Jones joined the ILG Financial team in 2020 as marketing director. Megan and her husband live in Fredericksburg, VA with their German Short Haired Pointer, Gus. Megan is a graduate of Longwood University and holds a degree in communications. Megan is the oldest of Dave Lopez’s three children and not only enjoys working alongside her father, but also with her cousin, Chase, who joined the ILG Financial team in 2020 as an advisor. Megan is also a fully licensed Life, Health, and Annuity agent. When not at work, Megan enjoys sitting on the back porch with family and friends enjoying food and music.
Amy Anderson joined the ILG Financial team in 2023 as the client relations coordinator. Her responsibilities include scheduling of appointments, annual check-up notifications, and annuity and required minimum distribution assistance. She is a graduate of Harding University with a degree in Computer Information Systems. Amy and her husband have two children and she enjoys reading, crocheting, music and spending time with her family.
Terri Center joined the ILG Financial team in 2019 as client services manager. She handles client records, application processing, and gathering information to provide a professional and friendly experience with all of our clients. Terri is a graduate of Oakland University. She is married and has two children. She enjoys hiking, family time, and puzzle challenging video games. She also likes to share her creativity in her canvas paintings and sewing projects.
Jessica Carson joined the ILG Financial team in 2018 as an agent. Jessica and her husband have four children, two dogs, 3 barn cats, 5 chickens, and three parakeets. She indeed loves her children and pets! When not at work, Jessica enjoys playing the piano and cello as well as traveling and spending time outside with her family, hiking, fishing, and boating.
Chase Lopez joined the ILG Financial team in 2020 as an advisor. Chase is a 2016 James Madison University graduate with a degree in management. Chase has been trained under the tutelage of Dave Lopez, who is not only the founder and managing member of ILG Financial, but also is Chase’s uncle and godfather. He also enjoys working alongside his cousin, Megan, who is Dave’s daughter.