The Fed hiked interest rates for the first time since 2018. Here's how that could hit your wallet.

Americans have gotten used to low interest rates for borrowing money, making it cheap to take out a loan for a home, car or other needs. But consumers will now find themselves paying more for all types of loans and credit this year now that the Federal Reserve has raised interest rates for the first time since 2018.

Fed officials on Wednesday afternoon announced that they are raising the central bank's benchmark short-term interest rate 0.25%. That might not seem like much, but a quarter point move in the federal funds rate is expected to be only the first of several such increases this year as the Fed normalizes monetary policy and tries to douse the steepest inflation in decades.