The Fed, politicians and most economists around the globe know that you have to have money in order to make money. However, since most American’s today are struggling to ends meet, few are willing to part with the hard-earned cash the government needs to stimulate a bad economy. To add insult to fiscal injury, the unemployment rate lingers at an ever-steady 8 percent. When people aren’t working, it’s difficult for them to spend money. The Fed’s answer to jumpstart a lagging economy? Make borrowing sexy again.
And making borrowing sexy again was the catalyst behind the school of thought when the Fed’s announced it was going to keep interest rates at lows through late 2014. For credit-worthy consumers the announcement should come as great news, because the credit world is now your oyster. Still, if you are stuck for ideas on how to pounce on current credit promotions, here are six ideas to help get you started.
Buy a New Home or Rental Property
With mortgage rates at jaw-dropping, historic lows, there is no better time than now to buy a brand new home, a home that is new to you or a property that you could use for rental income. The rental market remains hot, making real estate investing both a viable and profitable commodity.
Refinance Your Home
If moving isn’t in the cards for you, consider refinancing your current mortgage to a lower, fixed rate. Some banks are offering rates as low as three percent; an unbeatable deal.
Buy a Car
The automobile industry is waiting to sell you a new ride for a song. Since rates are low, you have an opportunity to swoop in, get a great deal with an extremely low rate and pay off that vehicle quickly.
While interest rates staying low may be great news in the credit market, it comes as not-so-great news for bonds and conventional savings accounts. Give your portfolio an overhaul and consider pouncing on higher CD and mutual fund rates.
Lock in Student Loan Rates
If you are a graduate, or if you are thinking of going back to school, now is a great time to negotiate locking in a low rate on your student loans. There are even multitudes of programs today available to help graduates consolidate multiple student loans into a lower rate loan with a single, manageable monthly payment.
Pay off Credit Card Debt
Consider borrowing money against your home equity or opening up a new credit card with a near zero rate to pay off or consolidate some of your higher interest rate debt.
Interest rates staying low is great for credit worthy consumers, but even if your credit isn’t so great, you have until 2014 to fix it and take advantage of some amazing deals.