Do nothing is a real answer
If the dollar edge does not clear your minimum, holding avoids work and preserves flexibility.
SwitchWize Financial Advisor
What should you do with cash when interest rates may change?
Decide whether to hold your current mix, lock more of today’s rate or stay flexible. See what you gain if your forecast is right—and what it costs if you are wrong.
1. Start with what you own2. Test your rate view3. Protect against being wrong
1 · Start with what you own
Where is your cash today?
2 · Test your rate view
What do you think rates will do?
This is your “what if,” not our forecast.
Fall 3 pointsNo changeRise 3 points
The trade-off
Locking wins when rates fall.
Flexibility wins when rates rise.
The calculator measures both: what you gain if your view is right and what you give up if it is wrong.
3 · Set your guardrails
What matters besides yield?
The advisor’s call
Lock half of your flexible cash
Split the difference. Lock some of today’s rate and keep some cash ready to benefit if rates rise.
If your view is right
+$68
versus holding your current mix
If rates rise 2 points instead
−$52
the price of being wrong
Cash available today
$6,000
after the suggested shift
Your three choices after 12 months
Same starting portfolio. Same rate scenario. Moving costs are included.
Keep your current mix
No change to today’s allocation
$20,602
Lock half of your flexible cash
$4,000 moved into a fixed rate
$20,670
Lock all available flexible cash
$8,000 moved into a fixed rate
$20,738
Existing fixed cash is already locked
A rate change does not alter its maturity payment. The decision begins when that money matures and must be reinvested.
A split is protection from overconfidence
Locking half gives up some upside in either direction to reduce the cost of being completely wrong.
How this advice is calculated
We compare holding your current mix with locking half or all of the flexible cash above your liquidity floor. We show a move only when its projected benefit exceeds the minimum gain you entered.
Flexible cash follows the rate path you choose. New fixed cash keeps today’s entered rate for the holding period. Existing Treasury bills or CDs keep their entered maturity payout; after maturity, that money earns the flexible rate.
“Balance both outcomes” favors a partial lock when being wrong could erase most of the benefit of being right. “Protect today’s rate” compares the weakest result across falling, flat and rising-rate cases. “Follow my rate view” follows the scenario you chose.
Results are educational, before taxes and based on the numbers you enter. They do not include early sales of existing bills or CDs, credit risk, fund losses, promotional conditions or future products that are not represented here.
Quick answers
What should I do with cash if I expect interest rates to fall?
Consider locking part of today’s rate in a Treasury bill or CD. Keep enough flexible cash for access, then compare the extra fixed income with the cost if rates rise instead.
What should I do with cash if I expect interest rates to rise?
Keeping more cash in a high-yield savings account, government money market fund or short-term Treasury bills lets more of it reprice. Existing fixed positions can usually mature before you decide where to reinvest them.
Should I move all of my cash?
Usually the better question is how much must remain available and whether the projected dollar advantage is large enough to justify a move. A partial lock can reduce the cost of being wrong.
Why these products behave differently
Treasury bills pay their face value at maturity, while savings and money market fund yields can change. Bank savings and CDs may have FDIC insurance within applicable limits; money market funds are mutual funds and are not FDIC-insured. Read the official explanations from TreasuryDirect, the FDIC and Investor.gov.