We're all in the same boat, but when those interest rates rise, what a happy day it will be for us all!
Not necessarily, because interest rates usually rise in response to inflation, so rising interest rates will probably be accompanied by increases in the prices of most things you buy (food, clothing, gasoline, etc.). Back when banks were paying 5% for a regular savings account and 10% for a five-year CD, inflation was running in the double digits. We're actually a little better off at today's low interest rates.
As for areas to target for budget-cutting, you might look at the $650 entertainment budget to see if that could be trimmed even by $100 or so. Our take-home income is close to twice yours but our entertainment budget is only $200/month and we usually don't spend that much. That doesn't mean we never go out or have fun, but most of our entertainment doesn't require spending money. Cooking good meals at home is entertaining for me, playing music with friends, taking a walk outside to look at the stars at night, reading a book from the library, etc. ... I count all that stuff as entertainment.