Higher interest rates squeeze younger and lower-income households. 'A rate hike is a blunt tool,' says expert

The Federal Reserve raised its benchmark interest rate at the conclusion of its September meeting and signaled another increase could be on the table this year. For consumers, the moves may significantly impact borrowing costs and savings returns . Generally, short-term consumer borrowing rates closely follow the Fed's benchmark, while longer-term loans are tied to the yield on the 10-year Treasury note , which also recently hit its highest levels in 19 years. Treasury yields have been spiking on the expectation of that inflation will remain high, making additional rate hikes more likely, experts say. Further, as inflation outpaces wage growth , workers lose purchasing power and have less financial breathing room.