How Should Entrepreneurs Respond to Changing Interest Rates?
Entrepreneurs need to be agile and responsive to changes in interest rates to maintain financial stability. Here are some strategies:
Refinancing: If interest rates drop, consider refinancing existing loans to take advantage of lower rates. Fixed vs. Variable Rates: Assess whether a fixed or variable interest rate loan is more beneficial. Fixed rates provide stability, while variable rates might offer lower initial costs but come with higher risk. Cash Flow Management: Keep a close eye on cash flow to ensure that your business can handle potential increases in loan repayments if rates rise.