Savings Interest Rate Forecast | Banking Advice
Key Takeaways
- The Federal Reserve has held interest rates steady throughout the first half of 2026, and observers don’t anticipate aggressive movement in either direction in the second half of the year.
- Despite the recent cuts, savings rates remain relatively high.
- The best savings interest rates often come from financial institutions like online banks and credit unions.
After cutting interest rates three times to close out 2025, the Federal Reserve has held its benchmark rate steady throughout the first half of 2026. The interest rate on savings accounts, which generally move in step with the federal funds rate, have also remained relatively unchanged this year after declining in late 2025.
Savings interest rates have been ticking down for several years now from their recent highs. Those peaks, brought on by a flurry of central bank rate increases aimed at combatting inflation, saw many high-yield savings accounts offering rates above 5%.
Despite the recent cuts, many banks and credit unions still pay relatively high interest rates on savings accounts and CDs, with the top APYs landing around 4%. The national average savings interest in June was 0.38%, but that figure is pushed down by major banks, which typically pay close to zero interest on deposit accounts.
See what to expect from savings interest rates in the second half of 2026 and learn how to capitalize on these trends.
What Savings Interest Rates Did in 2025
The Fed made three cuts to its benchmark interest rate in late 2025. It lowered the federal funds rate by one quarter of a percentage point in each of September, November and December, ending the year at a range of 3.5% to 3.75%.
Interest rates are still fairly high despite those cuts, and rates for mortgages, personal loans, credit cards and savings accounts have also stayed high.
As of June 15, 2026, the national average rate for savings accounts was 0.38%, according to the FDIC. You can check out the best high-yield savings accounts to see top APYs.
According to Deri Freeman, a certified financial planner with Prudential, interest rates may continue drifting down. “While interest rates have started coming down, and we expect that to continue, you can still benefit from high-yield savings accounts now, especially with savings accounts that offer well above the average interest rate,” says Freeman.
What to Expect from Savings Rates in 2026
Entering 2026, it appeared as if further interest rate cuts were on the horizon. Inflation was easing closer to the Fed’s 2% target, and incoming Fed Chair Kevin Warsh had signaled an appetite for slashing rates. The unemployment rate, meanwhile, had recently hit its highest mark in four years. The Fed combats high inflation by raising interest rates, while it tackles weakness in the labor market by lowering rates.
But inflation has since ballooned, reaching a three-year high of 4.2% in May. In the Fed’s June meeting, Warsh’s first as chair, the board unanimously voted to hold rates steady. Some governors noted that rate hikes may even be possible later this year if inflation doesn’t cool.
Observers generally don’t anticipate sharp movement on interest rates in either direction in the coming months. Savings accounts should continue to offer relatively competitive rates.
“I think savers probably won’t see quite the peak-rate environment we had over the last couple of years, but I also don’t think savings rates are going to fall off a cliff,” says Josh Jackson, chief financial officer at Florida-based Loyalty Credit Union. “As long as inflation remains a concern and the Federal Reserve remains cautious about cutting too aggressively, credit unions will still need to offer competitive rates to attract and retain deposits.”
Jackson says he could see savings rates dropping slightly in the second half of 2026, but not dramatically.
If that happens, generous rates will likely remain available, although fewer institutions may offer them, says Jim Pendergast, senior vice president and general manager of altLINE by The Southern Bank.
“Savers should still be able to find competitive accounts, but they may need to shop around more than they have over the past couple of years,” says Pendergast.
Strategies for Maximizing Savings Rates
You can earn more from your savings account while interest rates remain high. It’s a good time to take advantage by finding savings accounts and certificates of deposit with the highest annual percentage yields.
To get the maximum APY, look for high-yield savings accounts offered by digital banks, says Ohan Kayikchyan, a money coach and certified financial planner. These banks don’t have the substantial overhead costs of traditional brick-and-mortar financial institutions, so they can offer more competitive interest rates.
However, be sure to read the fine print on savings rates. Bonus rates, like introductory or teaser rates, are often an incentive to open a new account but may reset after a certain period. There also may be a balance requirement to get the advertised rate.
If you have money in a savings account and are considering moving to a different bank with a higher savings rate, see if your current bank can give you a better rate first. “Ask your current bank what they can do for you to keep your relationship and not move your money to a competitor,” says Kayikchyan.
Another option is putting money in CDs, which generally offer higher interest rates than savings accounts. CDs also allow you to lock in an interest rate, which will stay the same even if market rates drop.
However, there’s a trade-off in flexibility because a CD requires you to leave the money in the account for the full term. For example, if you open a one-year CD, you’ll need to leave money in your account for a year.
One option is to build a CD ladder by staggering maturity dates. A simple CD ladder might involve opening a one-year CD every month for a year. That can help you take advantage of high savings rates now and potentially rising rates in the near future while still maintaining access to your funds as the CDs mature.
Also, watch for bank account bonuses, which can pay hundreds of dollars when you open new eligible savings accounts. You’ll typically need to keep the account open, make a qualifying deposit and maintain a minimum balance for a specified period to earn the bonus.
Pendergast says savers should consider all features of an account, rather than simply selecting the one with the highest APY.
“It’s also worth remembering that the highest advertised rate isn’t always the best overall value,” Pendergast says. “A slightly lower rate may be worth it if the account better fits your overall financial needs and banking habits.”
