Asking for a Friend - I’m still seeing CD rates at my local bank over 5%. I’ve heard those rates may not last too much longer. Should I take advantage of them while I can?

Jan 15

January 15, 2024

Question:

I’m still seeing CD rates at my local bank over 5%. I’ve heard those rates may not last too much longer. Should I take advantage of them while I can?

Answer:

You’re right, those 5%+ interest rates may not last too much longer.

The Federal Reserve has hinted that they may cut interest rates at least 3 times in 2024. In the hope we can maintain low unemployment with declining inflation, interest rates will probably come down from current levels.

While cash really isn’t an investment strategy, if you do have some cash reserves that you don’t need in the next year or so, laddering CD’s or Treasuries may be a good way to lock in those higher rates before they go away.

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Amy Irvine

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