Fed holds rates steady. Here’s what that means for you

Credit card rates are already at a record high of 17.85 percent, on average, according to Bankrate.

Most credit cards have a variable rate, which means there’s a direct connection to the Fed’s benchmark rate. As the federal funds rate rises, so does the prime rate, and credit card rates follow suit. Cardholders would see the impact within a billing cycle or two.

The average American household is already carrying $6,929 in credit card debt month to month and paying a $1,141 annually in interest, according to personal finance website NerdWallet.

Tacking on a 25-basis-point increase, for example, would cost credit card users roughly $1.6 billion in extra finance charges, according to a separate WalletHub analysis. Because of the previous rate hikes, credit card users paid about $11.26 billion more in 2018 than they would have otherwise, WalletHub said.