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Senior Couple Interest RatesVery few aspects of the economy can have such a profound impact on your spending and saving as interest rates do. In fact, throughout much of the last decade, the Federal Reserve has relied on its control of short-term interest rates to influence economic activity. Now, some people might say that the Federal Reserve has made some pretty unconventional moves. After all, they cut the federal funds rate eleven times in 2001 and have been keeping the rates around 2% for much of the decade. I’d like to point out, though, that these short-term interest rates have very little effect in punching down high long-term rates like those seen in credit cards. Now, the primary reason for cutting interest rates is usually to stimulate spending. A lower interest rate on a loan can mean that a small business can purchase property and equipment, launch an advertising campaign, or even hire new employees. In short, lower interest rates can stimulate the economy.

On the surface, it might even seem like manipulating interest rates is a solid approach to steering one of the world’s most powerful economies. If the economy is moving too slow or not at all, lower interest rates. If the economy is moving too fast, raise the interest rates. If the economy seems fine, just leave it alone. The reality is that there are a few elements in any economy that can influence behavior more effectively than the interest rate.

I want new retirees and boomers to consider how little interest rates can actually have on your finances with proper planning. As a retiree and because of lower interest rates, you may find that you are able to purchase things that were previously out of reach without a loan.  But, interest rates only affect you when you’re using some form of credit.  If you take the the time now to plan effectively, you won’t need a credit vehicle, you’ll have more capital and you’ll free yourself from the influence of interest rates in your retirement years.

Call Freeman Owen Jr For Retirment Saving AdviceLet me help you get started with proper planning for your retirement years. Contact me at (866) 471-7233 for a free consultation so we can keep your money SAFE!