3 Ways to Make Higher Interest Rates Work for You

following A moratorium on interest rate hikes in June, all signs point to a recovery in growth when the Federal Reserve meets again next week. While the benchmark rate currently falls between 5% and 5.25%, most experts are predicting at least a modest increase above that. Higher rates make it more expensive to use credit cards from purchasing mortgages to refinancing mortgages, leaving many Americans with difficult choices and limited options.

That said, there are ways to make higher interest rates work for you. And with rates unlikely to drop anytime soon, now may be the best time to act. Start by exploring today’s top high-yield savings accounts to see how much interest you can earn

3 Ways to Make Higher Interest Rates Work for You

Here are three easy ways Americans can take advantage of today’s improved rates.

Open a high-yield savings account

If you currently have your money in a regular savings account, you lose money — or make very little of it. Because the interest rate on regular account is 0.42%, as per FDIC. Compare that to the interest you can earn with a high-yield savings account.

These types of accounts come with faster rates than what is available with regular savings accounts. You can find the account easily 4.5% APY or higher. Some are offering 11 times National rate. So do your research, shop around, and move your money into a high-yield savings account now to start making more money.

Get started here now!

Open a CD

If the interest rate with a high-yield savings account is attractive to you now, you’ll want to explore your Certificate of Deposit (CD) Alternatives These accounts often come with higher rates than high-yield savings accounts, though you must leave your money in the account for the entire term (or risk being penalized).

CD rate Also in the 4% to 5% range and they could go a bit higher following the Fed’s next rate bump. Although it pays to shop around and compare rates and terms Short term CDs Actually offering higher rates than long-term CDs (a direct reversal from last year).

Now start with a CD here.

Consider a home equity loan

Current mortgage rates Discouraged buyers from purchasing and existing owners from refinancing. luckily, Home values ​​have increased In many parts of the country, many owners are left with significant amounts of equity to use as they see fit. using a Home equity loan or Home Equity Line of Credit (HELOC)Owners can renovate and repair their existing homes, often at much lower interest rates than if they used alternative funding options like credit cards and personal loans.

Low interest rates and improved environment are not the only benefits of using a home equity loan, however. If used for qualified improvements, borrowers may also be able to They deduct the interest paid on the loan from their taxes At the end of the year. While your relocation and refinancing options may be limited, a home equity loan can be a great way to avoid the high interest rate climate.

Explore your home equity loan options here to learn more.

Bottom line

High interest rates don’t have to be all bad. In fact, savers can earn more by moving their money into different types of accounts. They can avoid buying a new home or refinancing their existing home and instead use their accumulated home equity to renovate, repair and improve their home or apartment. With rates expected to rise within days, now could be a great time to make these three moves.