Savings account rates typically rise and fall with the federal-funds rate, the benchmark interest rate set by the Federal Reserve. And barring a major shift in economic conditions, the Fed appears poised to start gradually cutting the federal-funds rate at some point next year. Investors largely expect savings rates to hold steady in early 2024 and then decline as we head into summer.

Here’s where savings rates may be headed-and how you can make the most of high rates while they last. There are also other options-such as certificates of deposit -that allow you to lock in current rates for a longer haul. If you haven’t snagged today’s sky-high savings account rates, there is still time, but you would be wise to act fast. “Rates will likely top out where they are today,” says Jason Steeno, president of CoreCap Investments in Southfield, Mich. As a result, most professional investors think banks are likely to start reducing savings rates-or at best, hold rates steady-in 2024. That means the Fed is unlikely to hike rates further and could cut them if the economy starts to weaken. Over the past several months, however, inflation has slowed.

That’s up from less than 1% in early 2022, before the Federal Reserve began hiking interest rates to fight rising prices. Today’s most generous high-yield savings accounts pay interest rates of 5% to 6%. But with the pace of inflation slowing, savers may not enjoy them for much longer. Interest rates on savings accounts are the highest they’ve been in years.

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