Key Takeaways
- After five rate holds this year, the Fed finally appears ready to make a cut—with a move widely expected next week.
- The announcement will also reveal where Fed officials see rates heading for the rest of 2025.
- A Fed cut means savings, money market, and CD rates will also drop.
- You can’t stop falling savings rates, but two smart habits can make sure you earn as much as possible.
- If you can set money aside, a CD lets you secure today’s high rates before they disappear.
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What Next Week’s Fed Meeting Could Reveal About the Rest of 2025
After almost nine months of the Federal Reserve holding interest rates steady, it’s likely that a shift is finally coming. Borrowers will welcome it, since credit card, auto loan, and personal loan rates could start to ease. But for savers, a falling Fed rate signals the beginning of the end for an unusually strong run on what you can earn at the bank.
The Fed pushed its benchmark rate to a 23-year high in 2023 and held it there for 14 months, sending savings, money market, and CD yields to historic levels—some topping 6%. Deposit rates declined slightly after three Fed rate cuts last fall, but since then, the central bank has stayed on pause through every meeting this year.
That rate hold almost certainly ends next week, with markets fully pricing in at least a quarter-point cut. The bigger reveal will be the Fed’s new “dot plot” forecast, showing how policymakers expect rates to look at the end of 2025. While markets currently project three cuts this year, Wednesday’s update will tell us whether the Fed agrees.
In any case, it seems savers can’t avoid lower rates ahead. But you can take steps now—and build smart habits going forward—to make sure your money still works as hard as possible.
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As Savings Rates Drop, 2 Smart Habits Can Maximize What You Earn
The rates banks pay on high-yield savings accounts closely track Fed moves. With one or more cuts expected this year, most savings rates will drift lower. How fast depends on the institution: Some will slash your yield in one step, while others will trim it gradually over time.
Unfortunately, you can’t stop your rate from falling. Savings accounts are variable-rate products, and banks can adjust the APY at any time—without notice.
But two smart habits can help you maximize what you’ll earn, no matter what happens with broader interest rates.
- Habit #1: Regularly check your savings account APY. Your current rate usually appears in online banking or your app, often under “Account Details.” It may also show on your statement—or you can call or chat with the bank to confirm. Staying on top of your APY ensures you’re not months behind on a big drop.
- Habit #2: Shop the market if your rate falls hard. If your bank drastically reduces your APY, switching could mean earning a lot more elsewhere. Our daily ranking of the top high-yield savings accounts makes comparing easy. And with electronic transfers, moving funds from your account to a new bank is generally easy
These two habits can help you make the most of falling savings rates, but to hold onto today’s great rates, you’ll want a different kind of account.
This Happened to Me
I didn’t assume the 5% APY on my high-yield account would last—but I was still surprised when it plunged a full percentage point. Worse, the bank didn’t notify me in any way. I only caught it because I make checking my APY a habit—proof of why it’s so important to regularly monitor what you’re actually earning. – Sabrina Karl, Investopedia Staff Writer
If You Act Fast, This Simple Move Can Lock In Today’s High Rates
When APYs are high and you want to secure them for the future, certificates of deposit (CDs) are a good tool to use. The rate you sign up for is guaranteed for the CD’s full term—whether that’s a short 3 months or a lengthy 5 years. No matter how far or fast the Fed lowers its rate, your CD rate won’t change.
With a Fed rate cut expected in just one week, time is short if you want to capture today’s top yields. Our ranking of the best nationwide CDs highlights 15 options paying 4.40% to 4.60% on terms from 3 to 12 months. You can also explore our term-by-term rankings for more choices, especially if you want a longer rate guarantee.
Just choose your CD term carefully, as you’ll be hit with an early withdrawal penalty if you opt to cash out early. It’s also smart to maintain a reserve in a high-yield savings account, since keeping a flexible cash cushion ensures you can cover surprise expenses without breaking your CD.
Daily Rankings of the Best CDs and Savings Accounts
We update these rankings every business day to give you the best deposit rates available:
Important
Note that the “top rates” quoted here are the highest nationally available rates Investopedia has identified in its daily rate research on hundreds of banks and credit unions. This is much different than the national average, which includes all banks offering a CD with that term, including many large banks that pay a pittance in interest. Thus, the national averages are always quite low, while the top rates you can unearth by shopping around are often 5, 10, or even 15 times higher.
How We Find the Best Savings and CD Rates
Every business day, Investopedia tracks the rate data of more than 200 banks and credit unions that offer CDs and savings accounts to customers nationwide and determines daily rankings of the top-paying accounts. To qualify for our lists, the institution must be federally insured (FDIC for banks, NCUA for credit unions), and the account’s minimum initial deposit must not exceed $25,000. It also cannot specify a maximum deposit amount that’s below $5,000.
Banks must be available in at least 40 states to qualify as nationally available. And while some credit unions require you to donate to a specific charity or association to become a member if you don’t meet other eligibility criteria (e.g., you don’t live in a certain area or work in a certain kind of job), we exclude credit unions whose donation requirement is $40 or more. For more about how we choose the best rates, read our full methodology.