Interest Rates: 5 Things You Should Know

ABC News' Chief Business and Economics Correspondent Rebecca Jarvis explains why interest rates matter to you.
1:15 | 04/27/16

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Transcript for Interest Rates: 5 Things You Should Know
Hey everyone I'm Rebecca Jarvis and mrs. five things the commission now about interest rates and here's why interest rates matter chief you don't they determine the cost of our wing and they also determine what you get paid. To keep your money in the bank. When interest rates go higher the cost of that student loan mortgage or car loan goes up. But at the same time the cost of what you get paid to keep your money in the bank. Also rise that's. Sets interest rates the Federal Reserve sets interest rates and eight increased the interest rate if the economy is growing too much they. If the economy isn't growing in. We're interest rates now. Lately they've been extremely low near 0% since 2008. The last time they were really high we're in the 1980s bass when you heard about mortgages at 17%. Now we can get a thirty year fixed rate mortgage. For around 4%. What do you low interest rates me. The whole idea behind low interest rates is twins and advise you took borrow and spend money not keep its savings in the bank. Which direction our interest rates going. Interest rates are rising but very slowly which ultimately means the cost of that mortgage for that Carlo. We'll be going up over time.

This transcript has been automatically generated and may not be 100% accurate.

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