Many savings accounts, certificates of deposit and money market accounts have enjoyed sizable interest rate bumps in 2022 as the Federal Reserve edges the target federal funds range higher.
Around this time last year, the best high-yield savings accounts earned an average of about 0.5% to 1%. As 2022 comes to a close, you can find online banks offering savings accounts with APYs of 3% and higher.
As long as the Fed keeps raising rates, high-yield savings account rates will keep inching higher.
But all that interest isn’t free money. You have to pay taxes on savings account earnings.
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