The Federal Reserve met this week and issued its second rate cut of 2025. The Fed cut the federal funds rate by 25 basis points.
One of the reasons for the rate cut was concern surrounding the job market. The recent job reports show only 22,000 jobs were added, indicating companies are holding back on hiring until they see the full impact of President Donald Trump's tariffs.
When rate cuts happen, they also impact savers by way of lower APYs. However, even with the rate cut, these high-yield options can help you earn returns that outpace inflation.
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
How to cushion inflation
While you might not be able to withstand inflation's impacts directly, there are ways to cushion your money to reduce its effect. And one of the best options is a high-yield savings account.
A high-yield savings account allows you to earn a high rate of return. Unlike certificates of deposit, you can add money to these savings accounts at any time.
You can withdraw or transfer those funds when you need them. Be careful of any minimum balance requirements that might apply, or your monthly fee might offset the interest earned.
Using this tool from Bankrate, you can see how rates currently measure up:
There are other considerations with a high-yield savings account. Chief among them is that they come with variable interest rates. If the Fed decides to cut rates again this year, your savings rates can drop, too.
When will rates drop? I've been reviewing APYs on CDs and high-yield savings accounts, and can tell you it varies by banks. While some have dipped rates slightly, others have not, giving you some time to maximize returns with higher rates.
Here are seven of the best options to consider:
Account | APY | Min. opening deposit |
|---|---|---|
4.35% | $0 | |
4.25% | $100 | |
4.25% | $1,000 | |
4.20% | $0 | |
4.20% | $500 | |
4.20% | $5,000 | |
4.00% | $0 |
Use budgeting apps to meet savings goals
Sometimes, a fresh perspective on where your money goes helps you identify spending patterns, and with them, opportunities for more savings. Some of our favorite budgeting apps are easy to use, affordable and can help you meet your savings goals.
One of the easiest to use is Quicken's Simplifi.
The bottom line on high-yield savings accounts
The Fed cut rates for the second time this year. While that will lower the APYs you can earn, our top picks offer you returns that'll help you outpace inflation and reach your savings goals.
Related content
-
Tariffs, Inflation, Uncertainty, Oh My: How to Feel Less Stressed About Finances Now, ReallyTariffs, high prices and an uncertain economy getting you down? These steps can help.
-
IRS Updates Capital Gains Tax Thresholds for 2026: Here’s What’s NewCapital Gains The IRS has increased the capital gains tax income thresholds for 2026. You'll need this information to help minimize your tax burden.
-
Tariffs, Inflation, Uncertainty, Oh My: How to Feel Less Stressed About Finances Now
Tariffs, high prices and an uncertain economy getting you down? These steps can help.
-
Three Veterans Charities to Support As Charitable Season StartsIf you're looking for a worthwhile cause to support for Veterans Day and beyond, consider these three highly rated charities that support veterans and their families.
-
A Nightmare for Parents: How to Navigate the Legal Boundaries of Tenant Rights During a Family CrisisThis family's story illustrates how important it is to get help sooner rather than later and highlights the complexities of tenant rights and legal protections.
-
I Need to Free Up $1,000 in My Monthly Budget, and I've Already Given Up Starbucks and Dining Out. What Else Can I Do?Here are some creative ways to save up to $1,000 a month, even if you feel like you've already made all of the obvious cuts.
-
Eight Steps to Help Get You Through the Open Enrollment Jungle at WorkWondering how to survive open enrollment this year? Arm yourself with these tools to cut through the process and get the best workplace benefits for you.
-
What You Learn Becoming Your Mother's Financial CaregiverWriter and certified financial planner Beth Pinsker talks to Kiplinger about caring for her mother and her new book.
-
I Want to Help Pay for My Grandkids' College. Should I Make a Lump-Sum 529 Plan Contribution or Spread Funds out Through the Years?We asked a college savings professional and a financial planning expert for their advice.
-
Seven Moves for High-Net-Worth People to Make Before End of 2025, From a Financial PlannerIt's time to focus on how they can potentially reduce their taxes, align their finances with family goals and build their financial confidence for the new year.
