Best moves to make now: Savings

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When the Fed makes a move, or even if it leaves rates unchanged, it affects your wallet. Here’s how the latest Fed announcement will affect interest rates in certificates of deposit.

Average yields on long-term CDs, one-to-five-year maturities, range from 1.36 percent to 2.99 percent.

On the shorter end, the average yield on a three-month CD is 1.09 percent and 1.17 on a six-month.

Money market accounts are paying an average APY of 0.74 percent.

Even without a rate cut it would appear that fixed income rates would continue to trickle downward; what’s different now is the imminent prospect of war. Many pundits expect a significant, if temporary, rally for the stock market if the war is decisive and fairly quick. What, if anything, that will mean for fixed income rates is anyone’s guess.

If you have a CD ladder, the philosophy is to keep replacing rungs with new CDs. That’s been an extremely tough discipline to stick with for the past year. If your ladder is short, six or nine months, then replace the rungs, but if you have a five-year rung coming due, it’s not advisable to replace it with a CD yielding 2.99 percent. Shorten your ladder and, perhaps, consider adding some additional three or six-month CDs. Check
Bankrate’s highest yielding CDs for candidates.