Federal Reserve hikes interest rates

The cost of borrowing money got a little more expensive, as the Federal Reserve hiked interest rates for a third time, this year.

The "benchmark" rate is what banks charge each other to borrow money, and the cost is passed along to consumers.

The move is an effort to keep the reigns on, what the central bank considers, a strong economy.

"Too much" borrowing prompts people to spend, which raises prices and threatens to spike inflation.

But the cost of servicing existing debt could go up.

Credit card debt, car loans, along with variable rate mortgages and home equity loans will all be affected.

A recent credit study found the average American's credit card balance grew by 3 percent last year to $6375.

Wallethub calculates the rate hike will cost credit card users more than $1.5 billion this year.

The Fed rate does not directly influence car loan rates, but Bankrate says it will cost borrowers another $3 a month for a $25,000 note.

Homeowners with adjustable rate mortgages and home equity loans will be more directly affected.

ARM's will go up, as they mature, unless homeowners refinance.

TD Bank says home equity borrowers with a $50,000 line of credit will see payments rise about $11 a month.

Individually, they are not huge increases. But, collectively, they do add up with each rate hike.

Rich Rosso of Clarity Financial is concerned, with high household debt and slow-growing paychecks, that rising rates will catch up with consumers.

"Since we live, for the most part, payment to payment, an extra $150 to $200 a month is going to make a difference," he says.

In his announcement, Federal Reserve Chairman Jerome Powell indicated another rate hike is likely in December, while three more could come next year.