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8 Finance Moves to Make Summer 2023

Finance | 06/30/2023 21:26

For the first time in almost a year and a half the Fed decided to not raise interest rates. In June 2023 they instead kept the prime interest rates between 5% and 5.25%. But what does that mean for our personal finances, and what moves should we be making in the summer of 2023?

Here are the 8 money moves you should be making in summer 2023.

What is going on with the economy in 2023?

The economy has been through a tumultuous time in the past few years. Shutdowns from 2020 have had lasting implications for the global economy, and inflation has been a major side effect. In order to combat the inflation that has run rampant the past few years the Fed has been raising interest rates over the past year and a half to ease inflationary pressures and get the economy to a more stable point.


But increasing interest rates have had other effects on our economy besides combating inflation. Increased rates means that borrowing money is more expensive so less people will borrow. This reduces the stress on banks. It also means that the stock market is more volatile as the economy becomes more and more uncertain. There is also a higher chance of recession when the rates increase. 

For the first time in a year and a half the Fed decided to not raise interest rates. This means that the prime rate is hovering between 5% and 5.25%. While it is good news for many that the prime rate didn’t increase more, the rate is still at its highest point in 16 years. Some of the effects include:

  • Highest rates for home equity lines of credit in two decades.

  • Credit card rates hit record highs for 12 weeks in a row.

  • Loan delinquency rates have increased 54% since last year.

We are clearly feeling this in our wallets, and a number of bank failures this year have proven that rising rates can have severe consequences.

But increasing rates have a flipside too. As the cost of borrowing increases the yield on savings interest increases as well. It is now easy to find a low risk savings account with an interest rate that outpaces inflation.

Is money safe in banks 2023?

With the failures of three banks this year–Silicon Valley Bank, Signature Bank, and First Republic Bank–there is a lot of anxiety over whether or not our money is safe in banks. And the answer is yes, for the most part. Banks are insured by the FDIC while credit unions are insured by NCUA. This means that any funds you have invested up to $250,000 ($500,000 for joint accounts) will be safe in a bank. The FDIC insures the following assets:

  • Checking accounts

  • Negotiable Order of Withdrawal (NOW) accounts

  • Savings accounts

  • Money Market Deposit Accounts (MMDAs)

  • Certificates of Deposit (CDs)

  • Cashier's checks

  • Money orders

  • Other official items issued by an insured bank


It does not insure stocks, bonds, mutual funds, safety deposit boxes, US Treasury bills, or crypto currency. 


If there is a bank failure the FDIC usually has money refunded to individuals within a few days of the bank failure.

What should I do with my money in 2023?

The finance world seems a little shaky (to say the least), so what should we do with our money to protect ourselves and our futures?

Move #1: Pay off high interest debt.

As interest rates keep rising it’s more important than ever to try to pay down your balances. High interest debt is usually from credit card debt, and this type of debt has a way of snowballing if you are not proactive about getting it paid down. You want to get to a point where you can pay off your credit card in full every month. Failing to do so will cost you a lot of extra money every month.


Move #2: Talk to your credit card company.

It’s a good idea to talk to your credit company even if your account is in good standing. If your credit score has increased since you initially opened your credit card, your credit card company might be inclined to give you a better APR. Most people don’t think to talk to their credit card companies, but open communication can help you out a great deal. If the rates are going to increase, you may be able to have your rate stay the same. If your rate is going to increase, companies are required to give you 45 days notice.

Move #3: Shop around for loans.

It’s not impossible to get a loan right now, it just means that you may be paying more. If you are looking for a mortgage or car loan, you can find rates that may still work for you but you need to shop around and compare to get competitive loans. Increasing your credit score will help you to get the best financing rates possible. 


Move #4: Look at your existing loans.

While you may think that refinancing a loan in 2023 is out of the question, you may be able to find a car loan or mortgage that has better terms than your original loan. Rates depend on a lot of factors such as your payment history, your credit utilization ratio, and your income–rates do not depend solely on the market rates set by the Fed. Summer 2023 is a great time to look at all of your existing loans and determine how each loan is working out for you. It doesn’t cost you a thing to get a free car loan refinancing quote and it could actually end up saving you a lot of money in the long run.

Move #5: Keep saving.

Saving accounts yields are the highest they have been in a long time and are outpacing inflation, which makes it a perfect time to look around and find a savings account that will make you money. These are incredibly low risk accounts which makes them perfect places to set up emergency funds. Experts urge people to save now as rates are high while inflation is lowering, so it is the perfect time to grow your savings. 

If you have some money that you do not need access to for a while, opening a long term CD might be a good option for you. This will allow you to take advantage of these high yields for a while. A 2-5 year CD means that you can profit from these yields even when the rates eventually decrease.

Move #6: Invest smartly.

When people get scared to spend and invest, the economy gets worse and worse. It becomes a self fulfilling prophecy that the economy will tailspin. Investments are risky by design, but if you are a long term investor with a diverse portfolio, a bump like this shouldn’t throw your finances into total disarray. This can actually be a great time to start long term investing if you have some extra money (don’t invest if you don’t already have a savings nest egg) and can wait it out for some returns. 

Move #7: Map out for the rest of the year.

The summer is a great time to reset before school starts up again and we slide into the holiday season. Use this time to start setting aside money for school and holiday shopping before time gets away from you and you have to scramble to make ends meet.

Move #8: Prepare mentally and financially for a recession.

A recession is still very much possible as we enter into the second half of 2023. Many experts think there is a 60-65% chance that we will hit a recession by the end of the year. A recession occurs when there is a contraction of the economy, where there is less production and less consumption. There is typically a higher unemployment level during this period. 

So what can you do to prepare for a recession? There are a few steps you can take to put yourself in a better position:

  • Make sure you have an emergency fund.

  • Have a plan in the case that you lose your job.

  • Pay down high interest debts that are increasing your monthly payments.

  • If you are struggling for extra cash to set aside consider working a second job or getting a side hustle. 


Getting yourself in a good financial situation in general is your best bet to prepare for a recession. Recessions cause uncertainty, so preparing for the unexpected is really all you can do.

Those are the finance moves you should make in summer 2023.


High rates mean two things: you need to pay down your high interest debts and you need to keep saving. Taking a good look at your budget and cutting costs where possible is the best way to do both of these things.


If your credit score has improved since your initial financing you still may be able to find a better car loan interest rate in this economic climate. Contact Auto Approve today to find out how much you could be saving!



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