(WFSB) – The Federal Seserve says it will keep interest rates at near zero for years.

It’s an effort to kickstart the economy during the coronavirus pandemic.

“The Federal Reserve, they control interest rates that the banks charge each other on overnight lending,” said Jay Rasmus, MahoneySabol. “What that means to people is money is cheap, mortgages are low, there are a lot of funds available.”

The first thing you need to know is borrowing is a bargain.

Jay Rasmus with MahoneySabol says you’ll likely see lower rates on loans and even credit cards as in incentive to encourage people to spend.

“Everyone is trying to get the market going again during this whole COVID pandemic,” Rasmus said.

The second thing is your savings may be stagnant.

“Right now, with interest rates being effectively zero, your money market accounts are practically getting nothing. So, if interest rates go up, your CD’s, money market accounts, you’d get a better return on that investment.

The Fed says rates will stay low for a few years.

The third thing people should know is to think about future finances and take a look at your investment portfolio.

“When the Fed raises the interest rates, a portfolio, the bond piece of your portfolio would decrease in value, so it’s an inverse relationship,” Rasmus said. “I always tell people if you have a balanced portfolio, meaning basically balanced with so much bonds, a little stock, and little bit of cash, that’s key.”

The key to weathering any financial storm.

Copyright 2019 WFSB (Meredith Corporation). All rights reserved.

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