We've explained how current high-yield savings accounts beat inflation rates, and what Fed rate cuts mean for your savings. How does inflation affect savingsIn order to understand how high-yield savings accounts beat inflation, you first have to understand what inflation is. Dixon says that, while high-yield savings accounts are good for shorter-term savings such as emergency funds, investing can be a good longer-term strategy — as long as you understand the risk. If your savings aren't kept in a high-yield savings account, the interest you earn on your savings could be outpaced by the current inflation rate. Using a high-yield savings account can help you save your savings from inflation because current high-yield savings account rates are higher than current inflation rates.

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