The Federal Open Market Committee, aka the “Fed,” announced today that it will keep its fed funds rate at the 0% to 0.25% target range.

The fed funds rate is the rate at which banks loan money to one another and may impact the interest rates on your credit cards, savings accounts, short-term loans (like an adjustable rate mortgage) and even long-term loans (like a 30-year fixed rate home loan).

The decision to hold the rate was expected, according to Quicken Loans CEO Bill Emerson:

“Although many Americans are still feeling the sting of unemployment, the Fed is seeing signs of economic improvement,” said Emerson.

“The Fed appears to be poised to keep it’s Fed Funds Rate at its current level for the time being, but must consider the right time to pull back on the current level of monetary stimulus.  When they do take action, many homeowners who have been trying to time the mortgage market in hopes of a lower payment will likely find themselves facing higher mortgage rates.”

If this post has left you scratching your head wondering, so what the heck does this do with me? Don’t worry, you’re not alone. Click here for a crystal clear explanation of how the fed funds rate may affect you and your money.