Investors who have benefited from low interest rates are showing signs that they may be worried about a potential rate hike. 

Half of investors say they are very or somewhat likely to take out a loan in the near future in anticipation that rates may go up, according to the third-quarter Wells Fargo/Gallup Investor and Retirement Optimism Index survey.  

In addition, the survey finds that 44% of investors say they would make major adjustments to their investment strategy if interest rates rise. 

It’s still uncertain whether a heavily contested Federal Open Market Committee meeting this week will result in a rate hike or not.  

The results of the Wells Fargo/Gallup Investor and Retirement Optimism Index, which includes a survey of 1,006 investors conducted Aug. 7-16 by telephone, was released on Tuesday morning.  

The study defines an “American investor” as an adult in a household with total savings and investments of $10,000 or more. Of those surveyed, 74% were not retired and 26% were retired. The median age of the retired investors is 70 and the non-retired is 45. 

A majority of investors have reportedly taken advantage of low interest rates. 

According to the study, nearly six in 10 investors (58%) are benefiting from lower rates. This includes by taking out a car loan (30%), refinancing an existing mortgage or home finance loan (17%), taking out a mortgage for a new home (16%), obtaining a student loan for themselves or a family member (9%), or taking out another type of loan (10%) over the past two years.  

“Investors found a variety of ways to benefit from the low interest rate environment, but this may be a good time for them to revisit their investment strategies and make sure they’re properly diversified to benefit in a rising rate environment as well,” Bob Vorlop, head of products and advice at Wells Fargo Advisors, said in a statement. “Those nearing retirement and retirees may be able to take some risk off the table in their portfolios.” 

Of the 44% of investors that would reportedly make adjustments to their investment strategy if rates rise, the most common action is buying more stocks. 

According to the survey, 30% say they would buy more stocks, while 8% say they would reduce their stock holdings.   

The survey found that about a quarter (23%) of investors would buy bonds or other fixed income investments, whereas 10% say they would sell these types of instruments. 

“In a complex market environment, interest rates changes are yet another factor that can be unsettling to investors, but one of the most important roles a financial advisor can play is to design portfolios that can meet investors’ objectives under a variety of circumstances,” Vorlop said in a statement. “That can be a tremendous source of comfort and confidence to investors,” he added.  An impending rate hike may also be the reason that two-thirds of the investors surveyed have been consciously reducing their debt.

Another reason may be that the slight majority of all investors (56%) say it is critically important for them to be debt-free in retirement, according to the survey.

While three-quarters of investors — including 83% of non-retired investors and 54% of retired investors — have some type of debt, the survey finds that most (89%) say they have made some effort to reduce their debt.

Among investors who carry debt (such as mortgage, credit cards or loans), nearly half (46%) say the amount of debt they are carrying has decreased in the past two years. Meanwhile, 31% of investors surveyed say it has increased and 23% say their debt load has stayed the same.

The survey finds that seven in 10 investors who say they made an effort to trim debt feel they have been successful in reducing their debt as much as they had hoped. However, 62% say they intend to make a major effort in the future to reduce their debt.

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