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Fed Rate Cut Looms: Lock in CD Yields Now!
9 Dec
Summary
- CD rates are expected to decrease following the Federal Reserve's anticipated rate cut.
- Top CD yields currently range from 4.05% to 4.50% for various terms.
- Locking in a CD offers a guaranteed yield, unlike a savings account's fluctuating rates.
With the Federal Reserve poised for a likely rate cut this week, savers are urged to secure high yields on certificates of deposit (CDs) before rates potentially decline. Top nationwide CDs are still offering attractive annual percentage yields (APYs) in the lower to mid-4% range, with some reaching 4.50% on terms from four to 24 months.
This presents a significant opportunity for individuals to lock in a guaranteed return for their investment. Unlike variable savings accounts, a CD offers a fixed APY for its entire duration, providing financial certainty even as the Fed adjusts its benchmark rate. Savers can choose terms ranging from three to five years, depending on their preference for flexibility or longer-term yield security.
Experts advise that while short-term CDs offer flexibility, longer terms are beneficial for locking in current high yields in anticipation of future rate decreases. For those considering depositing $10,000, it's crucial to remember that CDs should complement, not replace, a liquid cash reserve in a high-yield savings account for immediate access to funds.
