Rate Hike Hits Women Entrepreneurs Hard: How to Prepare

The Federal Reserve raised interest rates in September by increasing its target range for the federal funds rate to 3.75% to 4%. This decision affects not only businesses but also personal finances, particularly for women entrepreneurs who often have less financial capital than men.

A Forbes contributor notes that many founders lack a clear distinction between business and personal finances, which means higher borrowing costs can impact their personal lives as well.

The Federal Reserve's 2026 Small Business Credit Survey found that 59% of small employer firms carrying debt used a personal guarantee, while 86% regularly use some type of financing. Nearly two-thirds of firms with no employees other than the owner reported using their personal funds to address financial challenges.

To mitigate the effects of the rate hike, experts suggest listing all personal and business debts, including their rates and whether they are fixed or variable. This helps founders understand the consequences of higher borrowing costs and make informed decisions about their finances.