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still, the difference is “not earth-shattering,” he added.
Auto loan rates are fixed for the life of the loan,but car payments have been getting bigger as cars get more expensive. The Fed has had little impact on that affordability problem.
Although interest rates on new-car loans have edged lower, buyers are borrowing larger amounts – the average amount financed for a new car recently reached an all-time high, according to Edmunds. The share of car owners who are “underwater” on their outstanding auto loansor have negative equity, is also at a five-year high, Edmunds found.
“The Fed’s decision to keep rates steady through March will not noticeably impact consumers on its own, but it will certainly dampen the confidence of shoppers looking to take advantage of better rates in the new year,” said Joseph Yoon, consumer insights analyst at Edmunds.
Trump’s tariffs on foreign-made vehicles and car parts aren’t helping keep costs down either, other experts say.
On the upside, top-yielding online savings accounts still offer above-average returns.
While the central bank has no direct influence on deposit rates, yields tend to be correlated with changes in the target federal funds rate – so holding that rate unchanged could keep savings rates above the rate of inflation, which is considered a rare win.
“Four years ago, rates were basically zero; now, you can get 3% to 3.5%,” said
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