ATLANTA — The Federal Reserve’s first interest rate hike in three years could affect how much consumers pay on credit card debt and how much they earn on their savings.

The Fed raised interest rates by a quarter of a percentage point. WSB Consumer Expert Clark Howard says the decision affects short-term interest rates.

“So it means that your credit card interest rates are going to go up. What you can earn on saving should also go up. What you pay on a mortgage, it has no impact on,” Howard said.

For people carrying credit card debt, Howard recommends putting available money toward reducing those balances.

“There’s a big advantage right now with anything that’s quoting interest rate debt to put every effort you can afford into paying down that debt,” Howard said.

Savers could see higher returns. Howard says consumers should check what their bank or credit union is paying and consider other options if they are earning less than 4%.

“Pay close attention to what you’re earning on your savings with the bank or credit union that you’re at. If you’re not earning a decent rate which is really four percent or above on your money, you need to shop around,” Howard said.

KPMG Chief Economist Diane Swonk says inflation has remained above the Federal Reserve’s target for years.

“We’ve gone more than five years with the Federal Reserve not bringing inflation back down to its target, and that has compounded where the level of prices are just too high for too many,” Swonk said.

Projections point to the possibility of another interest rate hike later this year.

WSB Radio’s Ashley Simmons & Jonathan O’Brien contributed to this story.