MarketWatch tells us, "Want 5% yields? After Fed hike, it may be time to ditch high-​yield savings accounts for money-​market funds." The article says, "People focused on saving cash are poised to get another boost from the Federal Reserve on Wednesday as the central bank delivers another interest-​rate hike. Even so, rising interest rates have not been lifting all accounts equally. The Fed raised the benchmark rate by 25 basis points to 5.​25%-​5.​50%, the highest rate in 22 years. It marks the 11th rate hike of the Fed'​s last 12 meetings. Many high-​yield savings accounts now have annual percentage yields of around 4%, up from an average of approximately 0.​5% in March 2022, according to DepositAccounts.​com, a platform that compares rates in U.​S. savings accounts." It explains, "However, yields for many money-​market mutual funds are now hovering at 5%, up from an average of 0.​43% in March 2022, according to Crane Data, which tracks the industry. The seven-​day yields for many money-​market funds should hit the 5% mark as early as this weekend as the funds start absorbing the rate hike, according to Peter Crane, president and publisher of Crane Data. Money market funds -- low-​risk mutual funds composed of holdings like high-​quality government debt, repurchase agreements and corporate debt -- have swelled in size. On Tuesday, total assets in the funds hit a record-​breaking $​5.​9 trillion, up $​5.​2 trillion at the end of 2022, according to Crane. The assets in funds geared at retail investors hit $​1.​97 trillion, up more than 20% year to date, Crane said. The mutual funds for institutional investors climbed to $​3.​81 trillion, up 10% over the same time period. 'Retail has been where the action has been over the last year,' Crane said. `​The spread between deposit rates and money-​market fund yields '​are finally big enough to make it worth moving,' he said." The MarketWatch piece asks, "So is it worth pulling money from high-​yield savings accounts to chase even higher yields in money-​market funds? Money-​market funds have less liquidity, slightly higher risk -- hence the higher yield, experts say. Isabel Barrow, director, financial planning at Edelman Financial Engines, said yield is important, but it'​s not everything. Federal Deposit Insurance Corp. currently insures bank deposits up to $​250,​000 per account, while money-​market funds are not covered by FDIC insurance, she said."

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