When borrowing gets expensive and jobs get scarce, what does an owner do?

“The earth is the LORD’s and the fullness thereof, the world and those who dwell therein.” (Psalm 24:1, ESV)

Question of the week: When borrowing gets expensive and jobs get scarce, what does an owner do?

If your answer to “whose money is it?” is “mine,” a rising rate is going to feel like an attack. If the answer is “God’s, and I’m managing it,” then it’s a problem with a plan to fix it.

This week the plan has three parts: own your cash, own your value, and own your future.

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1. Own your cash

Start with today’s deadline. Cutting the price of what you owe is the first owner move. If you have federal Direct Loans and you’re not on autopay, signing up today (Sept. 30) gets you a 1% interest-rate reduction through June 30, 2028, up from 0.25%. It applies to Direct Loans issued after July 1, 2012. Already on autopay? Nothing to do.

On the SAVE plan? Check your inbox for a notice about switching plans. Miss the deadline and you can be moved to a Standard plan with a much higher payment. Log in to your servicer this week and make sure you’ve got it handled.

Now the bigger picture. The Fed raised its rate a quarter-point this month, its first hike since 2023. The 10-year Treasury yield closed the week at 5.184%, the highest since July 2007. The average 30-year mortgage rate jumped to 7.45%, its highest in more than two years. And traders now price roughly a 64% chance of another hike in October.

The S&P 500 gained 1.21% while small companies fell 0.80%.

3 ways this hurts a young steward:

1. Variable-rate debt gets pricier first. Credit cards, home equity lines, adjustable-rate mortgages, and some private student loans will feel it first.
2. Younger borrowers take the hit. Higher rates hit younger, lower-income borrowers hardest and favor older savers.
3. Your first big purchase costs more. If you were anticipating buying a home or a car, longer-term loans follow the 10-year yield.

“The rich rules over the poor, and the borrower is the slave of the lender.” (Proverbs 22:7, ESV)

Scripture doesn’t tell us what the Fed is going to do next, but it does tell us how to stand like stewards in this time.

3 ways to fix it:

1. Rank every debt by rate and send your next extra dollar to the highest one.
2. Stop adding variable-rate debt for wants.
3. Make your cash work. Money sitting in an account paying almost nothing is losing ground, so ask your bank what it pays. Then manage your working capital cycle: keep your portion in your hands for as long as you can, and pay what’s owed when it’s due, not before. If you use a credit card for this, it only works when you pay the full balance every month. Carry a balance and the rate wins.

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2. Own your value

More than 4 in 10 recent grads are working jobs that don’t require a degree, according to the New York Fed, and unemployment for grads ages 22-27 sits at 5.7%. So what does this tell us? Approaching the market like everyone else isn’t going to get the job done.

Joseph reached Pharaoh’s attention because he had already interpreted the dreams of men close to Pharaoh (Genesis 40-41). Young stewards, I know how hard it is to show anyone what you can do when nobody will give you a chance. But problems have a unique way of needing solutions. When a problem is bad enough, people will listen to anyone.

So here’s my take: if you’re not going to start a business, walk in anywhere they’ll allow you and start showing someone you can do the job. That’s exactly how I got my first job. One of the grocery stores near me was being robbed everyday, and the workers couldn’t keep up with sanitation while watching for theft. I walked in, told the first person I saw my name, that I was in college, and that I could clean toilets and push carts better than anyone.

My mother told me I wouldn’t be in college forever. I was on a mission. We watched a lot of spy movies growing up, and thinking of my life as a mission helped me make the most of that season. I treated that job like summer camp, not a life sentence. I learned everything I could, honored the people ahead of me, and built a skill I could have sold on my own.

That’s the owner mindset before you own anything: find a real problem and solve it.

“Whatever you do, work heartily, as for the Lord and not for men, knowing that from the Lord you will receive the inheritance as your reward. You are serving the Lord Christ.” (Colossians 3:23-24, ESV)

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3. Own your future

If your mission is to buy a business someday, the owner move is preparing now. New SBA rules start Oct. 1. For many first-time acquisitions, the minimum coverage ratio rises from 1.15x to 1.25x. If your annual loan payments are $100k, you’ll now need to show $125k in cash flow, not $115k. Every SBA-financed acquisition needs an independent valuation, and deals of $3 million or more may need a Quality of Earnings report.

The door is still open, but now it rewards preparation. Keep clean records, build your own equity, and guard your credit.

“The plans of the diligent lead surely to abundance, but everyone who is hasty comes only to poverty.” (Proverbs 21:5, ESV)

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Your moves this week

1. Own your cash: Turn on student loan autopay today if it applies to you, then list every balance you owe and its rate.
2. Own your value: Name one skill you could sell to one person this month, and test it.
3. Own your future: Pull your credit report and start your record-keeping file.

Build so that what you make outlasts you. That’s how Kingdom work gets funded for the next generation.

The L.Y.T. Framework: A Christian Guide to Financial Stewardship releases on LinkedIn in October. Comment LYT and I’ll message you the day it’s live.

I love you. May God Bless you and yours.

Purely educational content, not personalized financial advice.