INDIANAPOLIS — Borrowing money is about to get more expensive.
The Federal Reserve raised its key interest rate .75% Wednesday — the biggest hike since 1994.
The goal? To try and cool off red-hot inflation.
Existing fixed-rate loans like a mortgage or car payment will not be affected. But debt with a variable rate, like a credit card, will cost more money.
Matt Schulz with Lending Tree said people will probably see interest rates change within a billing cycle or two.
"Banks don't tend to wait around too long or take their time with raising these rates," Schulz said.
If you can't pay off the debt, experts suggest transferring the balance to a 0% balance transfer card.
"The average offer on one of these cards gives you anywhere from 12 to 15 months interest-free, and some go as long as 21 to 24 months. It's a really big deal. It can save you an awful lot of money."
But if your credit isn't good enough for a new card, call your existing card company and ask for a lower rate.
"About 70% of cardholders who called and asked for a lower interest rate in the past year, got one," Schulz said. "It can be a little scary to try and negotiate with a bank, but that success rate shows that it's not just folks with perfect credit scores."
You might also see a change if you have a home equity line of credit.
If you're a saver and don't have debt, look at where your savings is parked.
While it's easy to keep your checking and savings together, it usually pays you next to nothing.
Consider transferring your savings to a high-yield savings accounts. Online banks are paying close to or just over 1% now.