The Fed just hiked rates — here's what I checked in my own plan.

The morning after the Fed hiked, I did what I always do when rates move: I opened my own plan and looked at what actually changed. Not the headlines — my numbers.

Here's the setup, in case you missed it. On September 16, the Fed raised its benchmark rate a quarter point to 3.75%–4.00%. First hike in over three years, unanimous 12–0, the first under Chair Kevin Warsh. And the fine print mattered more than the hike: the FOMC's own Summary of Economic Projections — the "dot plot" every meeting produces — now has the median rate ending the year around 4.1%, with another hike likely before December — and the median for 2027 is 4.1% too, meaning the cuts everyone expected next year are off the table. Higher for longer is back.

So I checked the three places this hits a retiree's plan.

First, the cash. This part is genuinely good. My money market and short-term Treasury yields ticked up within days. If you're sitting on cash or buying new bonds, a hiking cycle pays you more. No complaints here.

Then the bonds I already own. This is the part nobody celebrates. Bond prices fall when rates rise — a bond fund with a 5-year duration loses roughly 1.25% on a quarter-point hike. I'd been thinking of my bond allocation as "the safe part." It isn't, not in a hiking cycle. I had to look at what those holdings are actually worth now, not what I paid for them. If you haven't repriced your bond funds since September 16, do it — the number may surprise you.

Then the part that stung: inflation. The whole reason the Fed hiked is that its own projection puts 2026 inflation at 3.7%, way above the 2% target. So my 4.5% CD minus 3.7% inflation is a real return under 1%. The nominal yields look generous. After inflation, they're thin. That's the math that matters, and it's the math most headlines skip — the same gap between a nominal yield and a real one that's been pushing safe withdrawal rate estimates around all year.

Here's why I keep coming back to this: most retirement calculators assume one fixed return — 7% a year, every year, forever. A hiking cycle is exactly when that fiction breaks. Bond values drop, yields rise, inflation eats the difference, and the order of those moves matters more than the average. My plan doesn't use a flat return; it runs year by year, because the regime you're in beats the average of all regimes.

The Fed meets again October 27–28. Whatever they do, my move is the same: model the world I'm actually living in.