Yesterday, analysts thought the Fed wouldn’t be raising rates at their next meeting, but today’s news makes everyone less sure that the recent runup in interest rates is ending. For a new business owner lucky enough to have gotten an adjustable rate loan, this is concerning.
In February, Entrepreneur had an article, “On Good Terms“, about moving your debt to fixed rate loans because of increases in short-term interest rates. It’s even more true now than it was then. The article points out that some types of variable-rate credit can’t be converted into long-term fixed rate financing if the assets securing them are short-term in nature. But a line of credit used to purchase capital equipment probably is convertible, and taking that step could save you a considerable amount in interest payments over time.