Retirement Talk Radio's Podcast

Laura Stover, RFC®, takes on the topic of interest rates today, and how they relate to your financial future. It is important to consider the historical context of interest rates. Over the past few decades, interest rates have been kept artificially low by central banks around the world. This was done in an effort to stimulate economic growth and prevent deflation. However, it was only a matter of time before rates began to rise. ​ If we look back to the 1970s, interest rates were much higher than they are today, even 19% at one point. This was a period of high inflation and economic instability, and the Fed's actions were aimed at cooling down the economy and reducing inflationary pressure. ​ In comparison, the current interest rates are still relatively low. While they may feel high for those who have only experienced the last 20 years of low rates, they are nowhere near the levels seen in the past.  ​ When the Federal Reserve raises interest rates, it aims to increase the cost of credit throughout the econ