Everyone—from small business owners to your recent college grad—is buzzing about the Federal Reserve’s next big move at its September 16–17 meeting: Will Chairman Jerome Powell finally start cutting interest rates? 

Fed Chair Powell recently hinted at a rate cut in September, so what does that really mean? And how will that really affect you and your wallet?

So Here Are 5 Things to Keep in Mind if the Fed Cuts Rates in September:

1. Borrowing may get easier — but saving may get trickier.

Lower interest rates generally mean cheaper mortgages, credit cards, and business loans. If you’ve been thinking about refinancing, buying a car, or expanding your business, this could be your moment.

But there’s a catch: Savers may earn less. The interest rates on savings accounts, CDs, and money markets could go down a bit.  This could nudge conservative investors a bit.  Maybe it’s time to consider things like dividend-paying stocks or short-term bond alternatives. 

This could be a good time to check in on your cash and make sure it’s still working for you.

2. Stocks might go up — but watch the mood.

Markets usually cheer a rate cut, especially sectors like tech, real estate, and consumer discretionary. These areas benefit from cheaper financing and increased spending. 

But the reason behind the rate cut matters more: If it’s to support healthy growth, stocks could rally. If it’s because the economy’s slowing and it needs an interest rate cut to get things moving, that’s not great and volatility may stick around. 

Either way, brace for a reaction.

3. Housing could heat up — or get weirder.

Lower mortgage rates often light a fire under homebuying demand, pushing prices higher—especially in already tight markets. If you’re selling, it could be great timing. If you’re buying, you might want to move a little quicker. 

That said, in past rate-cut cycles, we’ve actually seen mortgage rates jump unexpectedly, so don’t assume they’ll drop automatically.

4. The dollar may dip, and prices may creep.

Cutting rates can weaken the U.S. dollar, which helps exporters but makes imported goods more expensive. 

Translation: we could see inflation stick around a little longer, especially if consumer demand stays strong. This won’t help at the grocery store or gas pump.

5. Don’t expect a magic wand.

A rate cut won’t erase market drama or bring prices back to pre-pandemic levels. Trade tensions, earnings surprises, AI valuations, and election-year politics are still in play. While an interest rate cut may give investors a short-term boost, it’s not going to eliminate the uncertainty. 

So let’s see what happens mid-September. For now, take a deep breath and stay focused on the long game.

As always, please feel free to reach out to me at tbyrnes@lebenthal.com

Tracy Byrnes is a CDFA® and Vice President, Women and Investing, at Lebenthal Global Advisors. She focuses on assisting women through divorce, transition, and entrepreneurship. Her mission is to empower women financially so they can pursue their goals and confidently plan for the future. Tracy aims to be a stabilizing force for her clients, providing well-informed advice to help them plan for their families and businesses. Throughout her career, she has gained valuable insight and experience from the diverse range of people she has met, allowing her to translate complex concepts into straightforward advice. Tracy holds an M.B.A. in Accounting from Rutgers University and a B.A. in Economics from Lehigh University. She is also a financial expert who has been featured in multiple national networks and media outlets.