Credit scores are at record high levels. So too is credit card debt. Interest rates, meanwhile, are near historical lows but rising fast. Put that together, and you’ve got a recipe for impending credit damage.

Basically, Federal Reserve rate hikes make debt more expensive. For example, credit card users will have to pay an extra $6 billion in finance charges in 2017, thanks to the Fed’s four quarter-point rate hikes since December 2015, according to estimates from WalletHub. When the cost of debt increases, it’s harder to pay your bills on time. And if you don’t pay your bills on time, your credit score will suffer.

[See: 12 Habits to Help You Take Control of Your Credit.]

Many people, however, probably don’t see the financial changes coming their way. Sure, they’ve heard a lot about Federal Reserve rate hikes in recent months. But what do most of us really know about them?

As it turns out, what we don’t know can hurt us, according to findings from a nationally representative survey conducted by WalletHub. Here’s a quick overview of the findings:

— Credit card rates rise in lockstep with the Fed’s target rate, and more hikes are expected in the coming months. That’s bad news for the 60 percent of people who think their credit card rates are too high already. The average annual percentage rate, or APR, on new credit card is 18.36 percent, according to WalletHub research.

— 16 percent of people mistakenly believe the Fed is in charge of credit scores. There are three credit bureaus — Equifax, Experian and TransUnion — and two major credit-scoring companies — FICO and VantageScore — that would beg to disagree.

— 44 percent of Americans don’t know when the Fed last raised rates (June 2017).

— 18 percent of people think rate hikes are good for their wallet. Another 26 percent aren’t sure if they’re good or bad.

Unfortunately, these findings indicate that most people won’t find out about the personal finance implications of Fed rate hikes until their bills start growing. And they will grow. We’re already on pace to surpass $1 trillion in outstanding credit card balances by the end of the year, according to estimates from WalletHub. You have to wonder whether future Fed hikes will be the straw that breaks the camel’s back, leading to higher delinquency rates and lower credit scores.

But now that you know that Federal Reserve rate hikes can affect your credit standing, it’s time to do something about it. With that in mind, here are a handful of tips to whip your finances into hiking shape.

Start building an emergency fund. Setting aside a bit of money should be your top priority, aside from making at least the minimum payments required on your credit cards and loans. Doing this first, before focusing on repaying amounts owed, will help you avoid ending up back in debt if you encounter cash-flow issues in the future.

[See: 10 Quirky Ways to Save Money.]

Use the “Island Approach.” It’s difficult to adopt sustainable spending and payment habits if you don’t know when you’re overspending, or by how much. Budgeting can be helpful in this regard. But many people are hesitant to do it, thinking it will take too long. The Island Approach is another option. Basically, the idea is to use multiple credit cards and designate each one for a specific purpose.

This can give you some much-needed clarity if you use one card for everyday expenses and another for balances that you’ll carry from month to month. Since everyday expenses, by definition, shouldn’t lead to a balance at the end of the month, finance charges on this account will be a sign to rein in your spending. And by separating your everyday expenses from your revolving debt, you’ll pay less in finance charges. If you use one card for both purposes, your everyday spending will accrue interest on a daily basis, right along with your debt.

Finally, the Island Approach enables you to get the best possible terms for every transaction you make. No credit card offers both the best rewards and the longest zero percent APR, after all.

[See: What to Do If You’ve Fallen (Way) Behind on Your Credit Card Payments.]

Make a debt payoff plan. Once you’ve built an emergency fund and stopped overspending, it will be time to get serious about paying off what you owe. So figure out exactly how much that is, how much you can afford to pay each month, and how long it will take you to reach debt freedom. Knowing these figures will help with budgeting and finding the right balance-transfer credit card.

Do a balance transfer. The best approach to paying off debt is to repay the balance with the highest interest rate first, while making minimum payments on any other balances. And the best way to get rid of that first balance is to use a zero percent balance-transfer credit card.

The best cards offer zero percent introductory APRs for the first 15 months and don’t charge annual fees or balance-transfer fees. But you need good or excellent credit to get them. So if your score isn’t up to snuff, add credit improvement to the list of things that will help you get out of debt.

Finally, it’s important to check your credit score and review your credit reports on a regular basis. It’s always good to know where you stand, and any big changes could be signs of budgeting problems or fraud.

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How the Fed’s Rate Hikes Can Hurt Your Credit Score originally appeared on usnews.com