The Federal Reserve Board is expected to cut interest rates soon, and you can bet that banks will quickly follow their lead and slash rates on savings accounts and certificates of deposit. By purchasing a CD now, you can lock in favorable rates ahead of the Fed’s September 18 meeting. From the Chicago Tribune:
“Banks usually are really fast to cut rates and slow to raise,” he said.
Some experts are advising people to lock in longer-term certificates of deposit soon, at least with a portion of their savings, in case rates begin to slide.
“Locking in a CD is particularly attractive now,” said Greg McBride, senior analyst at Bankrate.com in North Palm Beach, Fla. “The yields haven’t yet reflected the idea of a Fed rate cut.”
If you have spare cash parked in a high-interest saving account, consider using Bankrate’s excellent comparison tool to find the best rate on a CD before the Fed busts the cheap money party.