Don’t expect a sharp uptick anytime soon, either. While borrowers, in many cases, feel the sting from higher interest rates right away, there is usually a delay before savers start to see any benefits.
For some savers, though, CDs are a viable option. Yet a number of planners say doing anything too long-term with them is a bad idea because, at current rates, you may see zero or even negative returns after accounting for inflation and taxes.
One approach given the interest rate climate, according to Fraasa, is to use laddered CDs, or putting your money in CDs with varying terms. This protects against losing out if the Fed should hike interest rates in the near future, which Fraasa puts at more than 50 percent likely.
“CDs are becoming certainly viable alternatives for people who need to keep money liquid over the next one to three years,” said Fraasa. “But if you’re investing longer than three years out, you should take a little bit of risk.”