April 2025 Update: 4 Safest Places Retirees Can Park Their Cash Right Now

If you're retired -- or planning to retire soon -- managing your cash is an important job to do. Your money should be safe, easy to access, and ideally still earning a decent return.

Yet according to the FDIC, the national average interest rate on checking accounts is just 0.07% as of April 2025. That's barely a trickle of growth.

The good news is there are many smarter options to store your cash right now. And some earn over 60 times that amount in interest. Let's walk through the top four.

1. High-yield savings accounts (HYSAs)

If you want safety and flexibility, this is the MVP right now.

Most high-yield savings accounts from online banks are offering 3.60% to 4.40% APY in April 2025. These accounts are:

• FDIC insured, up to $250,000 per depositor
• Easy to access anytime -- usually with no penalties or lockups
• Many have no monthly fees and minimums

An HYSA is perfect for your emergency fund, monthly drawdowns, or travel money. Your funds aren't locked up at all, but you're still getting a strong return.

2. U.S. Treasury bills (T-bills)

T-bills are ultra-safe short-term government bonds. Right now, yields on 3- to 6-month T-bills are hovering near 4.30%.

Why retirees love them:

• Backed by the U.S. government
• No state or local taxes on interest
• Great for money you won't need for a few months

You can buy them directly at TreasuryDirect.gov, or invest via ETFs in a brokerage account if you want extra flexibility.

These work especially well for laddering -- which means spacing out your purchases so something matures every month or so. That way, your money is always working, but still rolling in consistently.

3. Money market funds

These are not the same as money market accounts at a bank (which often pay less). A money market fund is a short-term investment vehicle that you can get at most brokerages.

In April 2025, many are paying between 4.08% and 4.24% on your cash.

They offer:

• High liquidity (you can access your cash quickly)
• Strong yields thanks to current interest rate levels
• Low risk -- though not FDIC insured, they're still considered stable

Pro tip: Check whether your brokerage automatically sweeps your uninvested cash into one of these funds. If not, you might be missing out.

Our experts picked Vanguard as the best broker for passive investors. Read our full Vanguard review to see how its low fees and no-fuss approach helps grow and preserve your retirement portfolio.

4. Laddered certificates of deposit (CDs)

CDs are great for short-term savings. But you've got to use them wisely.

Rates on 12-month CDs can hit 4.00% APY or more if you're willing to shop around. The catch with CDs is that your money is locked up for the length of your CD term (you can withdraw early with a penalty).

That's where CD ladder strategy comes in handy. The goal is to split your cash across multiple CDs with different maturity dates.

For example, you could buy these four CDs today:

• 3-month CD
• 6-month CD
• 9-month CD
• 12-month CD

As each CD comes due, you'll have access to that cash at various points throughout the year. It's like building your own income stream while keeping your money safe. Check out our list of the best CDs to start planning your ladder strategy now.

Keep your cash safe, but still working for you

Keeping a huge cash pile in your checking account might feel safe, but it's a huge mistake many retirees make.

With interest rates still high in April 2025, now's the time to make your cash work harder for you.

Even small moves -- like switching to a high-yield savings account or laddering a few CDs -- can make a real difference over time. Don't miss the opportunity.