Low Interest Rates Help Americans Save Money
Ultra-low interest rates have helped the average American to save more than $3,000 a year, according to a USA Today analysis.
Interest payments on mortgages have contributed to some of the largest savings. USA Today reports that mortgage interest payments have fallen 30 percent since peaking in 2007.
According to the Bureau of Economic Analysis, Americans spent 5.8 percent of their after-tax income paying interest on mortgages, credit cards, car loans, and on other debts — the smallest share since 1977.
Indeed, interest payments have fallen drastically on debt. Interest payments averaged $469 per month at the end of last year compared to the $728 per month peak in 2007.
Low interest rates are expected to continue too. The Fed has made a rare vow to keep key interest rates low through 2014.