Could savings accounts top 5%? What another Fed rate hike could mean for savers.

Savings account rates today are higher than they've been in years. If you're not already saving with a high-yield savings account, you could be missing out on 4% to 4.5% or even more in annual interest.

But there may be even better savings to come in the near future. The Federal Reserve once again meets this month, where it will determine whether to pause rate hikes or raise rates once again — after 10 consecutive increases since last March. In this environment it helps to understand how your savings account rates are affected by the Fed's moves and what it might take for high-yield savings accounts to move above the 5% threshold in the near future.

Compare today's top savings rates to best maximize your balance today.

Could savings accounts top 5% APY?

Savings account rates largely depend on the Fed's moves. While not directly correlated, banks use the rates set by the Fed as a barometer to help them stay competitive among other banks offering similar high-yield savings products. 

Right now, with the Fed's target rate just above 5%, it's common to find high-yield savings accounts offering 4% or 4.25%. A handful of online accounts already offer 4.5% APY, but they're not the majority, and the highest accounts we've found today top out around 4.85%. Short-term CDs are the most likely place to find over 5% APY today, but those accounts come with added restrictions and potential fees. 

However, rates could get up to 5% this year on savings, says Rick Valenzi, CFP and founder of Financial Zen. "Just watch the Fed. If they raise again, then savings account rates will go up as well."

Be among the first to earn future high rates by opening a high-yield savings account today. 

How the Fed's June meeting could affect savers

However, the Fed's next moves remain uncertain. 

After the most recent rate hike, Fed Chairman Jerome Powell said the extent of further rate hikes would depend greatly on economic data still to come. "We will make that determination meeting by meeting, based on the totality of incoming data and their implications for the outlook for economic activity and inflation," he said. "And we are prepared to do more if greater monetary policy restraint is warranted."

But signals since have been mixed. Some committee members have recently spoken in favor of another rate hike, while others say it could make sense to keep rates the same this month. If a pause is in store, Valenzi says we could have hit the peak for savings already. Time will tell if the Fed is ready for a rate pause, but if it does vote for another hike, there's a chance you could earn 5% on your savings.

What to know about saving right now

Whether the Fed will raise rates once again or is ready to pause rate hikes may still be unclear, but one thing is certain: Now is a great time to save. 

High-yield savings account rates are already high enough to help you earn hundreds of dollars on your savings balance, while regular savings accounts still earn near-zero interest rates. Plus, these accounts carry variable interest. If rates rise in the future, you'll automatically benefit from earning the new rate on your total balance.

"The most underutilized strategy that I see is using a high-yield savings account," says Brandon R. Amaral, CFP, founder of Amaral Financial Planning. "An individual can save $10,000 at Bank of America and only earn $1 of interest for a whole year. Whereas they can choose a high-yield savings account instead and earn $1 of interest in a day." 

Say you have a $5,000 balance in a high-yield account earning 4.5% interest today. If you maintain that rate over a year, you could boost your balance to a total of $5,225. You could increase that even more by starting with a higher balance or making contributions throughout the year.

Start taking advantage of today's high APYs with one of the top savings rates available now. 

The bottom line

The Fed's decision later this month could have a big effect on whether savers begin earning 5% on their high-yield savings accounts in the near future. While it's impossible to say what exactly the Fed may do, it doesn't change some of the best ways you can benefit from high rates today. Open a high-yield savings account with a competitive interest rate right now, and you can maximize high rates for as long as possible, while you get an automatic bump if your bank does raise its APY in the future.

Start saving more and see which of the best savings account rates right now is best for you.