---
title: Higher Yields on Savings Accounts? It Will Be Awhile
description: Waiting for higher yields on savings? Don't hold your breath. The Federal Reserve said in September it would buy $40 billion of mortgage-backed securities a…
authors:
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published: '2012-10-25T14:02:16.000Z'
modified: '2024-04-14T08:57:01.000Z'
section: Banking
tags:
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  - Federal Reserve
  - higher yields
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  - Investing
  - investment
  - QE3
  - Quantitative Easing
  - savings account yield
  - savings accounts
word_count: 154
canonical: https://money.com/higher-yields-on-savings-accounts-it-will-be-awhile/
type: Article
source: structured-blocks
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![The Mochida Family Waits for Internment](https://img.money.com/2012/01/505979091.jpg)
*In May of 1942, members of California's Mochida family wait for the bus that will take them to an internment camp while wearing tags so they will not be separated later.*

Waiting for higher yields on savings? Don't hold your breath.

The Federal Reserve said in September it would buy $40 billion of mortgage-backed securities a month until the labor market rebounds. The goal: to free up banks to lend more.

It's the Fed's third attempt since 2008 to use this tactic, called quantitative easing.

Targeting the 8%-plus jobless rate, QE3, as it's known, is likely to hold down mortgage rates which in October hit a 60-year low of 3.36%.

The Fed also plans to keep short-term rates near zero through mid-2015, so get used to current savings yields (recently averaging 0.12%).

And if you're looking to beef up bond fund income, Morningstar Investment Management economist Francisco Torralba suggests short-term corporates, which yield about 2% today. Though the risk of inflation is low, he says, a spike would hit higher-yielding long-term bonds harder.

Related: Should I invest in bonds or in a bond mutual fund?

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