Optimal Locations to Store Your Funds as Fed's Interest Rate Remains Elevated
Living in Times of Economic Uncertainties: Here's How You Can Boost Your Cash Stack
In today's rollercoaster economy, stemming from the ever-evolving tariff policies of President Trump, it's smart to bulk up your cash cushion. And guess what? You're in luck! Thanks to the Fed keeping interest rates high, your savings can still earn some nice returns.
Here's a lowdown on the top-notch cash-earning investments available right now:
- High-Yield Savings Accounts
- Hit the jackpot with the best options offering up to 5.00% APY!
- Certificates of Deposit (CDs)
- Grab CDs paying 4.50% and secure your APY as late as 2026.
- Brokerage firms and robo-advisors
- Earn 4% or better in money management accounts!
- U.S. Treasurys
- Score up to 4.81% with U.S. Treasurys available today!
Want the deets? Take a gander at the tables below for the latest returns on all these options.
Embrace the Good Old Green: It's Cool to Keep Some Cash
In this period of fretfulness triggered by the President's tariff policy, tucking away some cash seems reasonable. Yet, whether you're parking savings in the bank or shifting funds from riskier investments, it's crucial to browse the various cash strategies to gauge your returns.
Luckily, the choices are splendid right now, as returns are being buoyed by the Fed's benchmark interest rate remaining high. In fact, it looks like the central bank will keep its federal funds rate where it is for two more meetings. And according to the CME Group's FedWatch Tool, financial markets are pricing in 66% odds that the first 2025 rate cut won't come before the Fed's July 30 rate announcement[1].
This is fantastic news for savers, as the rates that banks, credit unions, and brokerages are ready to offer on your savings are directly affected by the federal funds rate. Whenever the Fed slashes that benchmark rate, rates for savings, money market, and CD accounts follow suit.
Top-of-the-Line Rates on Your Cash: May 2, 2025
For an appealing interest rate that involves little to no risk, the options for secure cash investment come in three main flavors:
- Bank and credit union products
- Savings accounts, money market accounts (MMAs), and certificates of deposit (CDs)
- Brokerage and robo-advisor products
- Money market funds and cash management accounts
- U.S. Treasury products
- T-bills, notes, and bonds, in addition to I bonds
Go ahead and mix 'n' match these cash goodies for diverse buckets of funds and timelines, or stick with one option—the choice is yours!
Bank and Credit Union Rates
Stay alert! Note that savings and money market account rates may vary, while CD rates are locked in for the duration of the term.
Brokerage and Robo-Advisor Rates
The yield on money market funds fluctuates daily, while cash management account rates can change at any time.
U.S. Treasury Rates
Treasury securities pay their rate through maturity and can be bought directly from TreasuryDirect or through banks and brokers. I bonds must be purchased from TreasuryDirect and can be held for up to 30 years, with rates adjusted every six months.
Summary Table: Cash Options Sorted by Rate
Here's a different look at all cash vehicles, placed side-by-side based on their rates. Keep in mind that the rates shown are the top rates for each product type.
Understanding Your Cash Options
Bank and Credit Union Products
Savings Accounts - Park your money in a bank or credit union savings account—also called a high-yield savings account—that lets you add and withdraw funds as needed. But don't assume your go-to bank pays a competitive rate. Many banks barely offer any interest. That's cool, though; we've got almost 20 high-yield savings accounts paying 4.35% to 5.00% APY[2] lined up for you!
Money Market Accounts - If you need paper check-writing, step aboard the money market account! Shop around from our list of the best money market accounts.
Certificates of Deposit (CDs) - A CD is a commitment with bite: If you cash out before maturity, your earnings will be dinged with an early withdrawal penalty. But don't worry; our daily ranking of the best nationwide CDs currently includes options paying up to 4.50% APY[3].
- For a personal-finance strategy that earns a high return during economic uncertainties, consider investing in a high-yield savings account, offering up to 5.00% APY.
- Additional cash-earning options include money management accounts from brokerage firms and robo-advisors, yielding 4% or better.
- To secure your returns for a longer period, explore Certificates of Deposit (CDs) available from banks and credit unions, some of which pay 4.50% as late as 2026.
- The treasury also offers U.S. Treasurys with returns up to 4.81%, making them an attractive investment option for personal-finance enthusiasts.
- Keep in mind that the eligibility to invest in Initial Coin Offerings (ICOs) may have certain restrictions, while the value of such investments can fluctuate significantly.
