These High APY Savings Accounts Could Continue to Spike After Yesterday’s Fed Rate Hike

Here we go again.

The Federal Reserve has raised rates yet again in an attempt to tame this year's runaway inflation, to absolutely no one's surprise. On Nov. 2, the Fed moved the target rate by three-quarters of a point, and the range now stands at 3.75% to 4%. That's the highest the federal funds rate has been since Jan. 2008.

What does this mean for you as a consumer? Even though this change only directly changes the rate at which banks and credit unions borrow money from each other, it will also impact consumer borrowing by raising interest rates on products like personal loans, credit cards…and savings accounts.

We recently covered why now is an especially bad time to keep a lot of money in your checking account, and as we see interest rates changing on other types of bank accounts, this keeps getting more and more true. Since most checking accounts don't earn interest, any money you keep in one should really be earmarked for uses like paying bills that are due in the near term, along with some cash buffer to keep you from accidentally overdrafting your account. So where should that extra money go instead?

High-yield options for your money

If you've got a longer-term plan like buying a home in a few years, you can put your money into certificates of deposit (CDs) or a money market account. But perhaps the easiest and most user-friendly place to stash your cash is a high-yield savings account. A savings account is the perfect place for your emergency fund in particular. While the interest you earn on money stored in one of these accounts won't beat the rate of inflation, it will help. And since savings accounts with high APYs (annual percentage yield, or how much interest you'll earn on a yearly basis) are often easy to open and manage by way of robust websites and mobile apps, it pays to give one of the following accounts a look. As of this writing, you can earn at least 3% APY on all of them, plus your money will be FDIC-insured.

UFB Portfolio Savings Account: 4.01%

UFB Direct is a fintech company that offers banking services, including a high-yield savings account. The UFB Portfolio Savings Account has no monthly maintenance fee, comes with a complimentary ATM card, and even includes checking-writing capabilities (and a round of free checks). Plus, no minimum deposit is required.

First Foundation Bank Online Savings: 4.00%

The First Foundation Bank Online Savings account has a high minimum deposit required ($1,000), but it also offers a very functional mobile app. Account holders can request a free ATM card to help with account management and make cash withdrawals easy.

CIT Savings Connect: 4.00%

CIT Bank's CIT Savings Connect account has a $100 minimum deposit requirement, but the bank is backed by First Citizens Bank, a top-20 U.S. financial institution. Your account will also come without monthly maintenance fees.

Consider your options

Is a high-yield savings account right for you? These accounts are pretty easy to use, and if you're comfortable with banking online, there are plenty of attractive options out there paying more than the national average for savings account APY. One of these accounts could be a great place for your money, especially right now.