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In today's unique economic climate, in which interest rate they are still high though inflation appears to be cooling significantly, Americans should be especially cautious about where they keep their savings. With rates high but the prospect of a cut growing, it makes sense to take advantage of select accounts and finance opportunities now, while they're still advantageous.
The start of a new month is often a good time to review what has worked financially and where your money could use a boost. Fortunately, with multiple savings account options available, now is a great time to save money at high rates. But how, exactly, can you increase your savings in July without taking unnecessary risks? Below, we've rounded up three easy and effective ways to do just that this month.
Get started to see how much more interest you could be earning with a CD account here.
3 easy ways to increase your savings this July
Here are three simple and easy ways to grow your money this month and in the months to come.
Open a CD
A certificate of deposit or CD it's an easy way to grow your money, especially now. Simply open an account with one online bank (as they generally offer higher interest rates) and deposit an amount of money you're comfortable parting with CD term.
Whether you choose to short term CD (12 months or less) or a long term one (over 12 months), both of which offer exponentially higher rates than average savings accounts do right now. And your money will be so protected from the temptation to spend it (since you'll be stuck with a penalty for early withdrawal if you do) and wider economic headwinds (since the rate you opened the account with is locked in for the entire term).
Check here what CD rate you can set this July.
Open a high-yield savings account
High yield savings accounts Come with rates almost as high as the best CDs right now, but you won't have to give up access to your funds like you would with a CD. However, high yield savings accounts work just like traditional savings accounts do, only with a much higher return.
But there's a problem: the fees for these accounts are variable and subject to change as the climate evolves. So savers who want to make more money, but don't want to lose affordability, act now, in early July. If they wait and the federal funds rate is cut in late summer or fall, rates on high-yield savings accounts will inevitably fall as well.
Get started with a high-yield savings account here now.
Consider refinancing
While a formal cut in the federal funds rate will ensure that rates on loan products and savings vehicles fall, lenders don't have to wait for that to happen to adjust their rate offers. Rates have already started to fall in anticipation of a formal rate cut, giving some borrowers an opportunity to refinance their existing high-rate debt.
So if you bought a home with a mortgage rate above 7% in 2023, you may be able to get substantial savings with refinancing at the current lowest average rate. If you have taken out a loan with a home loanlikewise, it can make sense refinance now. Just do the math carefully to make sure it's really worth taking action instead of waiting for a potentially better opportunity later this year.
See the mortgage refinance rate you're eligible for here.
The bottom line
This July is a good time to grow your savings and potentially reduce your expenses at the same time. Thanks to a climate of high rates that could be falling soon, savers should capitalize by opening high-priced products such as CDs and high-yield savings accounts. Borrowers should also explore ways to save more by potentially refinancing their current debt at today's slightly lower rates. By making these moves in early July, you can increase your savings both this month and the next.
