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Maximizing Cash Reserves Amidst Market Uncertainty

Key Takeaways

Given the uncertainties surrounding President Trump’s tariff policies, many are considering ways to increase their cash holdings. Fortunately, several options provide lucrative returns on cash investments, including high-yield savings accounts currently offering interest rates of up to 5.00%. While certificates of deposit (CDs) yield slightly less—up to 4.60%—they do offer fixed annual percentage yields (APYs) for extended periods, providing stability. Money market funds and cash management accounts, available through brokerage firms and robo-advisors, also deliver returns exceeding 4%. U.S. Treasurys are currently yielding as much as 4.75%.

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Assessing Cash Reserves: Smart Choices for Strong Returns

With the economic landscape shifting due to ongoing tariff regulations, enhancing your cash reserves appears prudent. However, whether you are choosing to maintain cash in bank accounts or redirecting funds from investments, understanding the potential earnings from various options is crucial.

You have multiple low-risk options for productive cash investments, categorized mainly into:

Bank and Credit Union Products: Savings accounts, money market accounts, and CDs
Brokerage and Robo-Advisor Products: Money market funds and cash management accounts
U.S. Treasury Products: Treasury bills, notes, bonds, and I bonds.

You can either select one of these or use a combination of products to fit different investment timelines and goals. Understanding the current returns is vital; we present the top rates available in each category, including changes from the previous week.

Current Cash Rates – April 25, 2025

Currently, the highest returns can be found in high-yield savings accounts, with two accounts offering rates of 5.00%. However, these options may come with conditions that might not be ideal for every investor, whereas a straight 4.60% is available without stipulations.

It’s important to note that savings and money market rates can be volatile. For more stability, CDs may be the better choice; the best rate available is currently 4.60% for terms of 6 to 10 months. Alternatively, consider options with slightly lower APYs but longer terms.

Rates for brokerage money market funds and cash management accounts have remained relatively unchanged this week, while Treasury rates held steady for shorter terms but showed some decline in longer durations.

Bank and Credit Union Rates

Below are the leading national APYs available from federally insured banks and credit unions, as determined by our comprehensive research involving over 200 institutions.

Brokerage and Robo-Advisor Rates

The yields on money market funds vary daily; however, cash management accounts typically offer fixed rates, with possible adjustments at any time.

U.S. Treasury Rates

Treasury securities provide a reliable return until maturity and can be directly purchased from TreasuryDirect or traded on the secondary market. I bonds, which must be bought from TreasuryDirect, can be kept for up to 30 years while having rates that adjust bi-annually.

Summary Table: Cash Options by Rate

Below is a comprehensive overview of the various cash investment options, arranged by their rates. Note that the rates reflected represent the highest qualifying rates for each product type.

Exploring Your Cash Investment Options

Bank and Credit Union Products

Savings Accounts

The simplest way to manage your cash is through a bank or credit union savings account. Often referred to as high-yield savings accounts, these allow for flexible deposits and withdrawals. However, it is essential to verify that your main bank offers a competitive interest rate, as some institutions provide negligible returns.

To facilitate your search for high rates, we provide daily rankings of savings accounts with APYs ranging from 4.35% to 5.00%. Keep in mind that savings account rates can fluctuate at any moment.

Money Market Accounts

A money market account serves as a savings account with the added benefit of check-writing capabilities. If this feature is valuable to you, explore our list of top money market accounts.

If you don’t require check-writing, select the account type with the higher yield, whether money market or savings. Currently, the leading money market account offers a rate of 4.40% APY, but be aware these rates can change unexpectedly.

Certificates of Deposit

A CD is a secure option that provides a fixed interest rate for a predetermined term, usually between 3 months to 5 years. This instrument guarantees a predictable return as the rate remains unchanged throughout the duration.

However, be cautious of early withdrawal penalties that can impact your returns if you opt for cashing out before maturity. Presently, our rankings reveal CDs offering rates up to 4.60% APY.

Important

It’s crucial to note that the “top rates” mentioned for savings accounts, money market accounts, and CDs are derived from an extensive analysis of the best rates identified by our daily research across numerous banks and credit unions. These figures differ significantly from the national averages, which include all institutions, emphasizing that many large banks often offer minimal interest. Therefore, national averages tend to be substantially lower than the top rates we present.

Brokerage and Robo-Advisor Products

Money Market Funds

Unlike bank money market accounts, money market funds are mutual funds that invest in cash and are provided by brokerage and robo-advisor firms. Yield rates can vary daily, currently ranging from 3.96% to 4.22% among leading brokerages.

Cash Management Accounts

Funds held as uninvested cash at brokerages or robo-advisors can be transferred into a cash management account, earning returns. Unlike money market funds, cash management accounts usually provide a specific interest rate, which might be adjusted at the discretion of the broker. At present, several well-known brokers are offering APYs between 3.83% and 4.00%.

U.S. Treasury Products

Treasury Bills, Notes, and Bonds

The U.S. Treasury provides a variety of bond instruments with various timeframes. Treasury bills have durations from 4 to 52 weeks, while notes mature between 2 to 5 years. Bonds are the longest-term option, spanning 20 to 30 years. Current yield rates on Treasury products fluctuate between 3.74% and 4.75%.

Treasury products can be purchased directly from TreasuryDirect or traded on the secondary market through banks and brokerages. Trading allows for exit prior to maturity, but this may incur fees. In contrast, purchasing through TreasuryDirect is fee-free.

Additionally, Treasury ETFs, which trade like stocks, offer distinct advantages and challenges.

I Bonds

U.S. Treasury I bonds feature rates adjusted biannually in response to inflation. They can be redeemed after one year or held for up to 30 years, with the rate changing every six months of ownership.

Tip

I bond rates will increase on May 1. Exact details of the new rates will be announced then, but existing I bond holders can anticipate an almost one-percentage-point rise in their next six-month rate. For further details on this upcoming rate change, including specific tables displaying rates for various bond dates, see our comprehensive coverage.

How We Determine the Best Savings and CD Rates

On a daily basis, we assess the rates offered by over 200 banks and credit unions that provide CDs and savings accounts nationwide. Our daily rankings highlight the highest-paying accounts. To qualify, institutions must be federally insured (FDIC for banks, NCUA for credit unions), and the account’s initial deposit requirement should not exceed $25,000, nor can the maximum deposit requirement be below $5,000.

Additionally, banks must operate in at least 40 states to be recognized as nationally available. While some credit unions may require a nominal donation for membership, we exclude those with donation requirements exceeding $40. For detailed insights into our methodology, please refer to our complete guide.

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