In Praise of Parking Some Coin: It's Smart, and It's Lucrative Right Now
Top Spots to Stash Your Reserves as Fed's Interest Rate Remains Elevated
In this era of economic instability, thanks to President Trump's ever-shifting tariffs, stashing some cash in reserve can feel like a wise move. But whether you're tucking your savings away in a traditional bank or moving it from riskier ventures, it's smart to consider your options for making the most out of your cash reserve.
Luckily, the opportunities are plentiful at the moment, as returns continue to be bolstered by the Federal Reserve's benchmark interest rate remaining robust. What's more, it appears that the central bank will keep its federal funds rate where it is for two more meetings. According to the CME Group's FedWatch Tool, the chances of the first 2025 rate cut occurring before the Fed's July 30 rate announcement are only 34%1 – a boon for savers.
віцеплати це установлюваний процент ставки, який банк отримує за гце drawing up a new loan. Банк отримує за відсотки від виручки за розміщення своїх грошей у позикових операціях.
Anytime the Fed cuts that benchmark rate, rates for savings, money market, and CD accounts fall as well.
Today's Top Investment Choices for Cash - May 2, 2025
There are three main ways to invest your cash in a low-risk, high-reward scenario:
- Bank and credit union products: Savings accounts, money market accounts (MMAs), 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, as well as I bonds
You can go with just one of these options or mix and match products for various buckets of funds and timelines. Here's a rundown of your best choices in each field, along with updates from the past week.
Bank and Credit Union Rates
The rates below are the top nationwide APYs (Annual Percentage Yield) from federally insured banks and credit unions, based on our daily research of over 200 institutions.
Disclaimer
Remember that savings and money market account rates are inherently variable, meaning the bank can lower them at any time. In contrast, CD rates are guaranteed for the product's full term.
Brokerage and Robo-Advisor Rates
Yields on money market funds shift daily, while rates on cash management accounts are more stable but still susceptible to change at any moment.
U.S. Treasury Rates
Treasury securities pay their interest through maturity and can be bought directly from TreasuryDirect, or through a bank or brokerage on the secondary market. I bonds can only be purchased from TreasuryDirect and can be held for up to 30 years, with rates adjusted every six months.
Summary Table: Cash Choices by Rate
Here's a breakdown of all of your cash vehicles, sorted by rate. Note that the rates shown are the highest qualifying rate for each product type.
Comprehending Your Cash Choices
Bank and Credit Union Products
Savings Accounts
The most basic place to store your cash is a bank or credit union savings account, or sometimes called a high-yield savings account, which allows you to deposit and withdraw funds as desired. But don't assume that your primary bank pays a competitive rate. With numerous options available, you can let us help you find the best deal – with almost 20 high-yield savings accounts offering 4.35% to 5.00% APY2. Keep in mind that savings account rates can change at any time.
Money Market Accounts
A money market account is a savings account that allows you to write checks. If this feature is essential to you, we've compiled a list of the best money market accounts. If you don't require check-writing, opt for whichever account type (money market or savings) offers the better rate. The highest money market account rate is currently 4.40% APY2.
Certificates of Deposit (CDs)
A certificate of deposit (CD) is a bank or credit union product with a guaranteed return and fixed interest rate for a set period of time. Generally ranging from 3 months to 5 years, CDs offer a stable return with a rate that cannot be changed for the duration of the term. However, cashing out before maturity can result in an early withdrawal penalty2. Currently, the top nationally available CD rates are:
- Bread Savings: Competitive rates across terms, with specific May 2025 rates to be determined soon4.
- NBKC: Offering 4.50% APY for a 7-month CD4.
Brokerage and Robo-Advisor Products
Money Market Funds
Unlike a money market account at a bank, money market funds are mutual funds invested in cash providers like banks and other financial institutions. These funds maintain a net asset value of $1 per share, and their yields can fluctuate daily but currently range from 3.98% to 4.23% at the three leading brokerages3.
Cash Management Accounts
At a brokerage or robo-advisor, you can have uninvested cash "swept" into a cash management account where it will earn interest. Unlike money market funds, cash management accounts offer a specific interest rate, which can be changed at any time. Currently, several popular brokers are paying 3.83% to 4.00% APY on their cash accounts3.
U.S. Treasury Products
Treasury Bills, Notes, and Bonds
The U.S. Treasury provides a wide selection of short- and long-term bond options. Treasury bills have the shortest maturities, ranging from 4 to 52 weeks, while Treasury notes have a maturity of 2 to 5 years. The longest-term option is a Treasury bond, with a 20 or 30-year maturity. The following table shows the yields on various Treasury instruments as of May 2, 2025:
| Instrument | Yield ||------------|-------|| 2-year note | 3.82% || 3-year note | 3.62% || 5-year note | 3.65% || 7-year note | 3.68% || 10-year note | 3.63% || 30-year bond | 4.04% |
You can buy T-bills, notes, and bonds directly from TreasuryDirect or from a brokerage or bank on the secondary market2. The fees for the secondary market purchases and sales might vary, while buying and redeeming through TreasuryDirect comes with no fees.
I Bonds
U.S. Treasury I bonds have a rate that changes every six months to follow inflation trends. You can redeem an I bond after one year or hold it for up to 30 years. The following table displays the yield for I bonds issued in the last 24 months:
| Issue Date Range | Yield ||------------------|-------|| Nov 1, 2023 - Apr 30, 2024 | 3.62% || May 1, 2024 - Oct 31, 2024 | 3.11% || Nov 1, 2024- Apr 30, 2025 | 3.98% |
To learn more about I bonds, including how their rates are determined and how to invest, read this article. To find out how your I bond yield stacks up against the current market trends, visit the Treasury's I bond calculator.
- In this era of economic instability due to President Trump's ever-shifting tariffs, securely storing cash in a lucrative manner, like a high-yield savings account or a money market account, can feel incredibly smart.
- The U.S. Treasury offers various low-risk investment options for cash, such as T-bills, notes, and bonds, and I bonds, which can be held for up to 30 years and have rates adjusted every six months.
- The eligibility for investing in a robo-advisor's cash management account allows for uninvested cash to earn interest, while the yield on money market funds can fluctuate daily but currently ranges from 3.98% to 4.23% at the three leading brokerages.
- To utilize a certificate of deposit (CD), one must be aware that it's a bank or credit union product with a guaranteed return and fixed interest rate for a set period of time, with the highest nationally available CD rate currently being 4.50% APY.
- Personal finance and investing in a low-risk, high-reward scenario can be supported by reviewing various options like bank and credit union products, brokerage and robo-advisor products, and U.S. Treasury products anytime to make the most of your cash reserve.
