The Federal Reserve has raised interest rates a few times this year in an effort to tame record-high inflation. These rate hikes have a cascading effect on everything from mortgages to savings accounts. But who wins and loses? We spoke to financial scholars to find out.

In the early stages of a rate hike cycle, consumers win because they pay less in interest on loans and credit cards. But in the late stages, that changes. That’s because when the Fed increases interest rates, it usually raises them on every loan that uses those rates as a reference. That includes everything from personal loans to auto and home equity lines of credit to adjustable-rate mortgages based on the prime rate. It’s a policy called “rate smoothing.” The idea is to avoid the shock of higher interest rates that would stifle demand and ultimately reduce prices.

But when the economy is strong, that can backfire by slowing demand and causing a recession. That’s why the Fed is trying to balance the interests of the consumer, business owners and the overall economy by raising rates gradually.

While many people will suffer in the short term, economists are hopeful that the long-term effects of the rate hikes will help the U.S. achieve its goal of low, stable inflation. And in the meantime, you can prepare by creating a budget that helps you manage your finances and stay on track to meet your financial goals.