5 things that get cheaper when the Fed cuts interest rates

Interest rates on credit cards are closely tied to the prime rate, so you'll likely see decreases near .25% on interest rates.

Americans now owe about $870 billion in credit card debt, as Business Insider's Gina Heeb reports, and Value Penguin estimates that the average American household has about $5,700 worth of credit card debt. With interest rates low, now is a good time to start dealing with it.

With this decrease, there's an opportunity to pay off credit card debts at a lower interest rate, or consolidate debt and lock in that lower interest rate.

For those with variable rate, private student loans, they just got cheaper. Variable rate loans are closely tied to the Libor or prime rate, and with that decreasing, you'll likely pay less in interest.

That said, it might also be a good time to refinance, and lock in a lower fixed rate on student loans. However, those who already have fixed rate student loans won't see any effects.

Considering giving a bathroom, kitchen, or backyard a makeover, but need a loan to make it happen? Homeowners can take advantage of the fact that home equity lines of credit just lowered their rates.

Bankrate reports that the average HELOC rate as of July 31 is at 7.8%.

Since HELOC rates are very closely tied to the prime rate, there's a good chance that these will drop by about the same amount as the amount that the prime rate dropped. In this case, it's likely that HELOC interest rates will fall by 0.25%.

Whether you're planning to buy a new or used car, the interest rates on auto loans will likely fall along with the prime rate.

In the fourth quarter of 2018, auto loan interest rates hit a 10-year high at an average rate of 6.3%, reported Business Insider's Rachel Premack. Hopefully, the Fed's cut will help to bring auto loan rates back down, even if just slightly.

While the rate cut will have no effect on existing loans, it might be a better time to look around and refinance your auto loan if you're feeling like your interest rate is too high.

• Read more:
• Here's how the Fed sets interest rates and why it matters
• The Fed has lowered interest rates for the first time since the depths of the Great Recession, but it's still a great time to save money
• When the Fed cuts interest rates, it affects everything from your savings account to your auto loans