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 moneyβ€”or 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 makeβ€”from 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