The 10-year Treasury yield is above 5%. Should savers lock in now?

Some offers on this page are from advertisers who pay us, which may affect which products we write about, but not our recommendations. See our Advertiser Disclosure .

The 10-year U.S. Treasury yield closed at 5.09% on Friday, according to the Treasury's daily par yield curve. Yields have retreated from recent highs but remain above 5% as concerns about persistent inflation and potentially higher interest rates continue to put pressure on markets.

For savers, higher yields could present a unique opportunity to lock in a fixed rate for a longer term, especially as they look for ways to keep pace with rising inflation.

However, whether a 10-year Treasury note is a worthwhile investment highly depends on your savings goals, when you'll need access to your money, and your tolerance for the risk of selling if rates change.

"If you are waiting on the Fed to push rates higher before you lock anything in, I would ask what exactly you are waiting for," said David Kassir, managing director of Private Wealth Management, Manna Wealth Management. "Nobody rings a bell at the top, and the income you collect while you wait is real money."

Why Treasurys can be appealing when rates are volatile

The Treasury yield is the return an investor receives for lending money to the government by buying a Treasury note . Interest is fixed and paid every six months until the end of your term, when you get your principal back.

Say you invest $1,000 in a 10-year Treasury note yielding approximately 5.1%. Your investment would generate an annualized return of about $51, assuming you hold the note to maturity. The actual cash interest payments depend on the note's coupon rate and purchase price.

If rates rise, your Treasury note becomes less valuable because investors can earn a higher rate on newly issued Treasurys. If rates fall, your Treasury note becomes more valuable, and you could sell your note before maturity and still recoup more than you originally invested.

You can sell a 10-year Treasury note before maturity through a bank, broker, or dealer. If you buy through TreasuryDirect, you must hold the note for at least 45 days before transferring it for sale. It's also important to remember that market prices and yields vary daily, so there's a chance you could sell at a loss if you sell before maturity.

The appeal of these notes is that they are backed by the U.S. government and pay a fixed rate, which can be reassuring when rates across other products keep fluctuating. The trade-off is that you're committing to a long-term investment in exchange for that fixed rate, and selling early could result in a loss.

Unlike other savings vehicles, such as high-yield savings accounts and money market accounts , you can count on a fixed rate that won't fluctuate with the current environment.

However, locking into a longer-term Treasury could mean missing out on potential savings if rates rise.

How Treasury notes compare to rates offered by other savings vehicles

Consumer prices rose 3.7% in the 12 months through September, according to the Bureau of Labor Statistics. To preserve your purchasing power, you'd need to earn 3.7% APY on your savings. However, to build long-term wealth, you'd want to opt for an account that earns even more.

A 10-year Treasury can certainly be a worthwhile investment to consider, but it's not your only option. Some experts suggest that pairing it with other types of savings vehicles for a more diversified approach can make the most sense. Especially because it's impossible to predict with complete certainty how returns across other products and investments will change over time.

A high-yield savings account or money market account could be a better option for savers who value more flexibility and greater access to their cash, while a shorter-term CD can be a middle ground for savers who want the benefit of a fixed rate, but may not be willing to commit to a 10-year term or are fearful that locking into a Treasury note now could lock them out of higher returns if rates continue to increase.

How to invest and decide whether now is the right time

You can buy Treasury securities through the TreasuryDirect website, or through a bank or broker. The investment minimum through TreasuryDirect is $100 and can be increased in increments of $100. Brokers may have minimums that start at $1,000.

Whether a long-term Treasury is right for you depends on your timeline for needing the money back, how much access you need to that money, and your savings goals.

Keeping tabs on how interest rates are changing can be valuable; however, experts caution savers against waiting for the "perfect" time to invest.

"For money you know you will need in the next year or two, I would not reach for duration just because the 10-year touched 5.10%," Kassir said. "But for longer-term money, especially retirees building an income ladder, these are the best yields we have seen in years, and I would rather ladder into them than sit in cash waiting for a perfect entry point nobody can time."

A 10-year CD allows you to lock in your interest rate over the next decade. But are 10-year CD rates competitive compared to other CD terms and account options? Learn more.

How soaring Treasury yields could hit your finances

Bond yields rise as bond prices fall, impacting everything from stock and bond markets to loan rates and savings returns.

High-yield savings account vs. Treasury bill: Which is right for you?

If you're looking to earn a high interest rate on your savings, two options to consider are high-yield savings accounts and Treasury bills. Learn more about the differences between T-bills vs. savings accounts and which one is best for you.

Here's how much you'd earn by putting $10,000 in a CD for 5 years

CDs allow you to earn a guaranteed interest rate for a set period of time. So, how much could you earn by putting $10,000 in a CD for five years?

How much interest does $10,000 earn in one year?

If you have $10,000 in savings, putting it in the right account can help you earn interest on the balance. How much interest could you earn in one year? Let's break it down.

Should you buy Series I bonds as inflation persists?

Series I bonds are gaining popularity among savers. Here's how they work and whether they're right for you.