After holding interest rates steady for much of 2025, the Federal Reserve closed out the year by trimming its benchmark rate three times between September and December.
The central bank has now cut the federal funds rate six times after raising it 11 times throughout 2022 and 2023 to combat inflation. We may see further rate cuts in 2026.
Despite the recent cuts, many banks and credit unions still pay relatively high interest rates on savings accounts and CDs.
See what to expect from savings interest rates in 2026 and learn how to capitalize on these trends.
[Read: Best Savings Accounts.]
What Savings Interest Rates Did in 2025
The Fed made three cuts to its benchmark interest rate in late 2025. It lowered the federal funds rate by one quarter of a percentage point in each of September, November and December, ending the year at a range of 3.5% to 3.75%.
Interest rates are still fairly high despite those cuts, and rates for mortgages, personal loans, credit cards and savings accounts have also stayed high.
What to Expect from Savings Rates in 2026
The Fed has lowered rates at its last three meetings, and economics observers anticipate further moderate cuts at some point in 2026.
Inflation currently sits at 2.7%, stubbornly stuck above the Fed’s target rate of 2%. The U.S. unemployment rate has ticked up to 4.6% as of November, marking the highest level in four years. The Fed combats high inflation by raising interest rates, while it tackles weakness in the labor market by lowering rates.
[See: Best High-Yield Savings Accounts: Up to 4.57% APY]
Strategies for Maximizing Savings Rates
You can earn more from your savings account while interest rates remain high. It’s a good time to take advantage by finding savings accounts and certificates of deposit with the highest annual percentage yields.
To get the maximum APY, look for high-yield savings accounts offered by digital banks, says money coach and certified financial planner Ohan Kayikchyan. These banks don’t have the substantial overhead costs of traditional brick-and-mortar financial institutions, so they can offer more competitive interest rates.
However, be sure to read the fine print on savings rates. Bonus rates, like introductory or teaser rates, are often an incentive to open a new account but may reset after a certain period. There also may be a balance requirement to get the advertised rate.
If you have money in a savings account and are considering moving to a different bank with a higher savings rate, see if your current bank can give you a better rate first. “Ask your current bank what they can do for you to keep your relationship and not move your money to a competitor,” says Kayikchyan.
Freeman also recommends checking with credit unions that have high-yield savings rates. Unlike traditional banks, credit unions operate under a not-for-profit model, which helps them offer members more competitive rates.
Another option is putting money in CDs, which generally offer higher interest rates than savings accounts. CDs also allow you to lock in an interest rate, which will stay the same even if market rates drop.
However, there’s a trade-off in flexibility because a CD requires you to leave the money in the account for the full term. For example, if you open a one-year CD, you’ll need to leave money in your account for a year.
One option is to build a CD ladder by staggering maturity dates. A simple CD ladder might involve opening a one-year CD every month for a year. That can help you take advantage of high savings rates now and potentially rising rates in the near future while still maintaining access to your funds as the CDs mature.
Also, watch for bank account bonuses, which can pay hundreds of dollars when you open new eligible savings accounts. You’ll typically need to keep the account open, make a qualifying deposit and maintain a minimum balance for a specified period to earn the bonus.
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Savings Interest Rate Forecast originally appeared on usnews.com
Update 01/02/26: This story was published at an earlier date and has been updated with new information.
