When deciding between fixed and variable interest rates, it's important to consider your financial goals and tolerance for risk. Fixed interest rates remain constant throughout the loan term, providing predictability and stability in monthly payments. On the other hand, variable interest rates fluctuate with market conditions, potentially offering lower initial rates but also carrying the risk of future increases.

For example, if you prioritize stability and want to accurately budget your monthly expenses, a fixed interest rate may be the better choice. This is particularly beneficial when interest rates are low, as locking in a fixed rate can offer long-term savings.

Conversely, if you anticipate interest rates to decrease or if you plan to pay off the loan quickly, a variable interest rate could lead to lower overall interest costs. However, it's essential to be prepared for potential rate hikes and the resulting impact on your payments.

References:

• Forbes article on fixed vs. variable interest rates: Fixed vs. Variable Mortgage Rates
• Bankrate's guide to understanding fixed and variable interest rates: Fixed vs. Variable Rate Mortgages