As we move through 2025, the direction of interest rates remains uncertain. The Federal Reserve has held rates steady for several months amid mixed economic signals, including a resilient job market and persistent inflation. Many analysts believe rate cuts are possible later this year—but nothing is guaranteed. Staying financially flexible is key. (1)
Fact: As of June 2025, the Federal Reserve has kept its benchmark interest rate between 4.20% and 4.50% while signaling that future cuts will depend on further data on inflation and employment. (2)
While we can’t predict what the Fed will do next, we can prepare. Here are a few money moves worth considering if interest rates begin to decline:
Make the Most of High-Yield Savings Accounts
If interest rates drop, returns on savings accounts may follow. Now could be a good time to take advantage of current high-yield savings account rates. These accounts generally pay more than traditional savings, helping your money grow more efficiently while it still can.
Consider Certificates of Deposit (CDs)
CDs lock in today’s interest rate for a set period, shielding your savings from potential declines. A CD ladder—staggering your savings across CDs with different maturity dates—can give you both access and stability as the rate environment shifts.
Reevaluate Your Debt
If you carry high-interest debt, such as credit cards or personal loans, watch for opportunities to refinance or consolidate if rates begin to fall. Lower interest rates can reduce monthly payments and total interest paid over time.
Check Your Investments
Interest rates influence everything from bond yields to stock prices. Take this time to reassess your investment portfolio. Is it diversified? Does it align with your goals and risk tolerance? Staying aligned with your long-term strategy is more important than reacting emotionally to rate news.
Staying Prepared for Economic Changes
No one can control the economy, but staying informed and flexible can help you respond wisely. Whether interest rates rise or fall, having a plan—and periodically revisiting it—can help keep your financial goals on track.
What’s Next for You?
Everyone’s financial situation is different. These strategies are just a starting point. If you’re unsure how potential rate changes might affect your plans, consider speaking with a financial professional who can provide guidance tailored to your needs.
Source:
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(1) CNBC. “Some money moves to make before the Fed starts cutting interest rates.” CNBC, July 25, 2024. www.cnbc.com/2024/07/25/where-to-move-cash-before-fed-cuts-interest-rates.html.
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(2) Investing.com. “United States – Interest Rate Decision.” Investing.com, www.investing.com/economic-calendar/interest-rate-decision-168. “Money moves to make before the Fed starts cutting interest rates.”
This information is being provided only as a general source of information and is not intended to be the primary basis for investment decisions. It should not be construed as advice designed to meet the particular needs of an individual situation. Please seek the guidance of a financial professional regarding your particular financial concerns. Consult with your tax advisor or attorney regarding specific tax issues.
