Interest Rates Explained
Understand the price of money and how interest rates shape borrowing, investing, and economic growth
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Inflation & Deflation
The Price of Money
Interest rates are the cost of borrowing moneyβor the reward for saving it. When the Federal Reserve changes its target rate by just 0.25%, trillions of dollars shift across the global economy: mortgages become cheaper or more expensive, businesses expand or contract, and your savings account yields more or less.
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Why This Matters
Interest rates influence every financial decision you makeβfrom credit card debt to home buying to retirement planning. Understanding how rates work empowers you to time major purchases, optimize debt, and make smarter investment choices.
What You'll Master
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Rate Mechanics
How central banks set and transmit rates
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Yield Curves
Reading signals from bond markets
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Real vs Nominal
Adjusting for inflation's impact
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Economic Impact
How rates shape growth and prices