The Fed recently voted to raise interest rates again in an effort to corral record-setting US inflation. While this move can help curb soaring prices, it’ll also mean higher interest charges for credit cards, mortgages and personal loans. As a result, it may become more appealing to save money and pay down debt if you aren’t currently carrying much.

Interest rates typically rise when the economy is growing fast and consumer demand for borrowing is high or when there are good investments for lenders to make. As the economy slows, however, there’s less demand to borrow and fewer good investment opportunities for lenders, so interest rates decline.

When the Fed raises interest rates, it makes borrowing more expensive, and consumers may reduce how much they spend if they’re paying more in interest charges. This can cause businesses to cut back on investments and job hiring, which in turn slows overall economic growth.

As a result, the stock market usually takes a hit when the Fed hikes rates. In addition, global investors who have been invested in emerging markets may withdraw their capital, causing those countries to experience financial crises.

But while interest rate hikes aren’t great for borrowers, they are a boon for savers. When interest rates rise, the APY (annual percentage yield) on savings tools like bank accounts and certificates of deposit — which are pegged to the federal funds rate — increase too. This means that the money you’ve accumulated in these accounts will grow faster.