Upcoming Fed rate hike prompts savers to seek higher-yield accounts
With a near-90% chance of a 25-basis-point increase at its September 16 meeting, the Federal Reserve is set to raise rates, prompting advice on better-earning deposit options.
Data from the CME Group's FedWatch tool shows a roughly 90% probability that the Federal Reserve will increase its policy rate by 25 basis points at the September 16 meeting, moving the target range to between 3.75% and 4.00%. Higher rates will tighten credit conditions for home purchases, refinances, personal loans and credit-card borrowing. Savers, however, can capture the upside by moving money out of low-yield checking accounts that currently earn about 0.38%.
Three deposit products are highlighted: certificates of deposit, which lock in a fixed rate; high-yield savings accounts, which offer variable rates that can rise with future Fed moves; and money-market accounts, which provide modest rates and check-writing capability. Consumers are urged to compare offers across banks to secure the most competitive terms.
Why it matters
A Fed rate hike reshapes borrowing costs and savings returns, affecting everyday financial decisions.
In this story
