Cd investing benefits from the current macro

CD investing benefits from the current macro backdrop: strong US labor markets and persistent inflation, which lead to elevated interest rates. Economists expect CDs to maintain appeal as equity valuations appear stretched. Glen is an editor on the Fortune personal finance team covering housing, mortgages, and credit. He’s been immersed in the world of personal finance since 2019, holding editor and writer roles at USA TODAY Blueprint, Forbes Advisor, and LendingTree before he joined Fortune. Glen loves getting a chance to dig into complicated topics and break them down into manageable pieces of information that folks can easily digest and use in their daily lives. Both high-yield savings accounts and CDs earn higher-than-average APYs and are great options to grow your savings risk-free. However, they differ in several key ways. Unlike CDs, high-yield savings accounts have variable interest rates, meaning your account’s APY will fluctuate based on the market. And while CDs charge an early withdrawal penalty, high-yield savings accounts allow you to deposit and withdraw funds whenever you want. Bank of America data indicates CD investing flows surging in Q2 2024, particularly among retirees and conservative investors seeking to lock in high APY before potential rate cuts later this year.