Trump's New Tariffs Could Hit Your Bank Hard -- Here's What to Do Now
KEY POINTS
- Trump's tariffs raise costs for U.S. businesses across the board.
- If tariffs trigger a recession, the Federal Reserve may cut interest rates sooner and more aggressively.
- A high-yield savings account can help protect your money from shrinking returns.
President Donald Trump's tariff hikes have already had a massive ripple effect across the global economy -- and your bank account might feel it, too.
The Federal Reserve expects to cut interest rates twice in the second half of 2025. But if the economy sinks into a recession, then the Fed may cut rates even more. That means savings account APYs could plummet before the year is out.
If your money's in a traditional savings account, you could already be earning as little as 0.01% APY. That's a fraction of a penny per year for every dollar you deposit.
With rate cuts on the horizon and the economy looking shaky, now is a better time than ever to open a high-yield savings account (HYSA).
Why now is a smart time to switch to an HYSA
The best high-yield savings accounts are still paying APYs as high as about 4.50%. They're also FDIC insured and easy to open, and they often come with zero monthly fees. Most importantly, they pay nine times more interest than the average bank -- or more.
If you're worried about tariffs and economic uncertainty hurting your finances, switching to an HYSA is a simple way to take more control. You won't just protect your money from shrinking returns; you'll actively grow it.
What to look for in an HYSA
When shopping for a high-yield savings account, keep an eye on:
- APY: The higher, the better -- but watch out for promotional rates that drop after a few months.
- Fees: The best HYSAs have no monthly fees, account minimums, or hidden charges.
- Access: Make sure the account offers easy transfers to and from your checking account and external accounts.
Online banks can offer higher rates because they don't have the overhead of physical branches -- which could also help them weather cost hikes from tariffs better than traditional banks.
What are you waiting for?
The impact of Trump's tariffs is still up in the air, but they've already raised big concerns about the U.S. economy and savings rates. Rather than wait and see how your bank reacts, get ahead of the curve by moving your savings to a high-yield account.
Ready to make your money work harder for you? We recommend a CIT Platinum Savings account, with a 4.10% APY for balances of $5,000 or more. Open an account now and start enjoying more financial freedom today.
Our Research Expert
Ryan is a full-time personal finance writer at Motley Fool Money. He’s been covering topics like credit cards and savings since 2022, focusing on helping people who are new to the world of personal finance.
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