There are many ways the Federal Reserve has to raise interest rates The one they failed to take yesterday was a raise in the rate banks must pay for funds they borrow from other banks.
There are two major ways a Fed rate increse can impact your company's 401 (k). If you have any of your account funds invested in bond mutual funds, you could be effected. As in terest rates go up, bond prices tend to come down reducing the size of your account. A less direct way rate increases could impact your plan could come from your company not having enough working capital to make their matching plan contributions if they make one, or having to lay off employees, including you, which would definitely hurt your 401 (k) account.
A less direct impact would come from a rate increase raising the price of everything you buy which would drive up the cost of retirement and cause your 401 (k) account to fall short of your retirement goals if you don't increase your amount of periodic withholding. This alone should cause all 401 (k) plan participants to pay closer attention to their accounts.
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