This week on The Retirement Readiness Podcast, hosts Tim Regan and Katie Umland tackle a topic that’s relevant at every life stage: interest rates—how they work, when to finance a purchase, and how to make smarter borrowing decisions. From buying a first TV on a college budget to considering a mortgage payoff in retirement, Tim Regan and Katie Umland break down the basic concepts and address common misconceptions about borrowing, tax deductions, and credit scores. “Whenever you’re going to borrow money, there’s a number of things that I kind of like to think through,” Katie Umland says. “The first one is recognize that if you have to borrow money and there is an interest rate associated with it, you just increased the purchase price by a lot.”

Listen as they walk through real-life examples of common borrowing decisions—from cars to student loans—and offer practical rules of thumb to help you decide when financing makes sense, and when it doesn’t. Plus, Tim Regan and Katie Umland discuss the emotional side of debt, strategies for getting organized, and how interest rates can affect everything from home buying to your grocery delivery bill.

3 Key Takeaways

– Before financing any purchase, determine whether it’s out of necessity or choice, and always do the math to understand the real cost.

– To efficiently pay off debt, prioritize payments on the highest interest rate balances first, and stay organized with a clear list of what you owe.

– Interest rates and their impact on everything from mortgages to car loans start with how banks assess risk and set rates—your credit score matters.

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