the federal reserve boosted its influential interest rate yet again wednesday even as more signs indicate that inflation is cooling it hiked the benchmark’s key rate by a quarter of a basis point bringing it to the 45–475 range one basis point is equal to one hundredth of a percentage point the fed’s central bankers have said the rate needs to get above 5 to bring inflation back to 2 inflation as measured by the consumer price index hit 65 in december 2022 the lowest reading since december 2021 the fed announcement on wednesday pointed at the need for “ongoing increases” stocks were trading in positive territory on wednesday afternoon shortly after the fed’s announcement advisers are increasingly focused on how to store cash in productive ways that take some supersafe yields said andres garciaamaya founder and ceo of zoe financial a platform linking financial advisers with potential clients discussions with clients include strategies for highyield savings accounts cd ladders and treasury debt one recurring theme in the last six months is how much to pour into bonds he noted the dow jones industrial average djia  the sp 500 spx and the nasdaq composite comp posted their worst performance last year since 2008 against a backdrop of inflation rising rates and recession worries so far in 2023 things are looking up the dow jones industrial average is up approximately 3 yeartodate while the sp 500 has gained 6 and the techheavy nasdaq composite climbed more than 10 so is the average portfolio poised for a rebound or another year of declines trying to time investment moves are always perilous said leanna devinney vice president branch leader at fidelity investments “market volatility is to be expected understanding your specific goals risk tolerance and financial picture and how your investments align can help you stay fully invested through different market events” she said here is what some advisers are advising their clients to do with their money bonds are one part of a portfolio’s defense the “bond side of your portfolio may be deploying an airbag for protection if something were to go wrong” said ulin ceo of ulin  co wealth management in boca raton fla when interest rates raise bond prices fall so the quick sequence of fed interestrate hikes last year and all the other market woes made it tough for bonds last year marked “the worst year for bond investors basically within any of our lifetimes” tom essaye president of sevens report research wrote in a research note in december with a new year however there is new hope for bonds to give some consistent downside protection higher rates mean higher interest payments vanguard has noted in its forecast for 2023 it’s projected us bond returns 41–51 annually goldman sachs gs analysts said that during january there was a 91 billion flow into funds for lessrisky investment grade bonds or about 24 of their assets under management to start the year ulin has beefed up bond exposure for clients in early 2022 he reduced clients’ bonds to 1 year to avoid duration risk that is the risk that bonds with farther away maturities lose their value while interest rates rise now ulin thinks the fed is “close to the oneyard line” in the goal on sufficiently high rates so he’s “not overly concerned about duration risk on bonds or interest rates greatly going up in 2023” he has already repositioned his clients balanced model portfolios “into more short to intermediateterm municipal us treasury and investmentgrade corporate bond etfs and funds that were discounted from the bond bear market and now providing suitable yields” as interest rates rise so do annual percentage yields on savings accounts certificates of deposit and other safe places to store cash the apy for an online savings account now averages 331 according to depositaccountscom which tracks rates a year ago the average was less than 05 the yield for a oneyear cd from an online bank is averaging 436 up from 05 a year ago thomas scanlon a manchester connbased financial adviser with raymond james has already trimmed clients’ equity exposure and builtup cash exposure specifically scanlon sees very shortterm 30 to 120day cds as a “viable tool” for the next six months or so it’s a conservative move he notes but scanlon said this strategy is producing some return when there are so many open questions about interest rates debt ceiling negotiations and the economy’s future “for the last 15 years pure savers were penalized” scanlon said noting when the fed’s benchmark rate was persistently low in order to generate economic growth particularly during the great recession “the benchmark fed funds rate is at 2007 levels and it may not be coming back down nearly as soon as investors seem to think” said greg mcbride chief financial analyst at bankratecom “the combination of rising rates and easing inflation is a winner for savers the topyielding nationally available online savings accounts are earning over 4 and still rising a rate that looks better every time inflation ticks lower” he said