The Bank of Canada just raised the interest rates for the first time in 7 years up to 0.75%. This is the biggest financial news on a federal level since they dropped in 2009 and here's what it means for your wallet.
1) Student Loans
As a student, you have up to six months after you graduate to start paying your loans. With this rate hike, you're going to have to pay more the longer you wait given how much higher the interest is now.
If you have already begun paying them off, then unfortunately you'll have to pay the rest of it at a higher interest rate. We're still all very lucky to be receiving our higher education here in Canada compared to the U.S. regardless of how much our student loans cost.
2) Credit Card
As long as you're staying on-time with repaying your credit card, the hike should affect you only minimally when it comes to paying back the bank.
However, if you start repaying later then instead of having your credit card bill be at, for example, 19% interest, it can balloon up to 24% which means that paying off your credit card is going to be priority #1 when it comes to money management for the time being.
3) Savings Loans
Finally, the good news portion of this article. Interest rates are a two-way street so the longer the bank holds onto your money, the more you get based on the percentage. Since that number just went up to 0.75%, you're savings account might just get a little brighter.
If you want more information, you can check out the official Bank of Camnada statement right here