Suze Orman Says We Might See Interest Rates on Treasuries Go Back Up — Here’s Why
Written by
Diana Kelly Levey
Edited by
Zuri Anderson
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The U.S. Treasury interest rates have been about 1% lower than this time last year, but financial expert Suze Orman says on a recent podcast episode that she thinks that’s going to shift.
Orman predicts that these government-backed financial products are going to have higher interest rates in the future. How near that future is, we just don’t know yet.
“Treasuries are instruments where you buy from the United States government bonds or notes or bills that they’re offering and they use that money, truthfully, to cover our deficits and other things to pay for our lack of money,” she said.
Here’s why interest rates may be going up in the future, according to Orman. The longtime money expert also revealed three treasuries she would divide her money between right now.
What Orman’s Prediction Means
“Three years ago the government paid all of us who bought treasuries $300 billion in interest. Today, the government is paying us $1.3 trillion dollars in interest,” Orman said.
Eventually, many of these treasuries will come due, the money expert noted.
“And many of these treasuries were purchased a few years ago, when the interest on treasuries was relatively nil,” she explained. “Those treasuries — some of them — are coming due. And when they come due, chances are the people who own them are going to just re-up for another maturity.
“But the interest rate that the government will owe is going to go up, as well,” Orman said. “So we’re getting ourselves into a situation where the government is having to pay more and more interest on the treasuries.”
It’s possible that people will be demanding more of a yield if they’re going to go into treasuries in the future, she shared.
“It’s very possible that a few years from now we’ll see, believe it or not, interest rates on treasuries going back up again,” according to Orman.
What To Do With Your Money Now
Whether Orman takes advantage of those interest rates increasing or not, she still will likely follow these frugal habits:
As of November 2024, the Series EE Savings Bond issued between Nov. 1, 2024, and Apr. 30, 2025 is at 2.6%. The EE bond stays the same for 20 years while an “I Bond” is at 3.11% for the next six months.
Some high-yield savings accounts are averaging 4% or better APY this fall. Although they can change from month to month, exploring this type of higher-interest savings account might be a smart place to park your money if you’re waiting to see if Orman’s treasury interest rate predictions come true.
If you’re behind on retirement savings, Orman suggests prioritizing your needs over your want and save all that you can.
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