Last Wednesday, the Federal Reserve (the Fed) raised national interest rates in what some are calling a sign of the end to the 2008 recession and while raising the rate seems great for bankers and business, how will the increase affect millennials?

As far as I understand raising interest rates means banks will be far more inclined to loan money to patrons, since they will be collecting more profit in the long run from the higher interest rates, however, patrons will be far less inclined to borrow money because they will pay more in the long run. That’s why the Fed raises interest rates when they believe the economy is growing at a faster than healthy rate: when money is harder to borrow, people spend less; when people spend less the economy shrinks slightly. Unfortunately, this means purchasing big ticket items will be harder, and this cannot bode well for millennials.

As some are aware (and others should be), our generation has inherited the label, “boomerang generation,” meaning that we leave home, our parents, for college and return to them after graduating. Our situation comes from a number of dismal reasons—including student debt, which is now higher than ever, high cost of living, and lack of high-paying jobs and competition for those high-paying jobs—which force us to return home when in the past we would have been able to leave. But with the rise in interest rates, millennials will have an even harder time purchasing the essentials for their independence.

With the increased interest rates, car loans and mortgages will be far less appealing, and people with variable interest rates on loans may see an increase in payments. Luckily, there’s a silver lining when it comes to student loans: most student loans have fixed-rate interests so they are unlikely to rise. However, students looking to get a first time loan next year will most likely have steeper interest rates than their counterparts who took out a loan before the Fed increased the interest rate.

It’s really too early to make any decisive judgement on the affects of the interest rate increase. At a glimpse it looks like the increased rate can do nothing good for millennials and while it may seem bad initially, as long as wages manage to increase steadily along with the rising interest, people can afford to take out loans, then things will hopefully turn out okay.