What to Do When Your Money Market Isn’t Cutting It

Two weeks ago, I walked into my local bank branch in Palm Beach to check on my money market account. To my surprise, the interest rate had dropped from 3.85% to 1.8% and that was before the Fed made its most recent cut.

As someone who has spent over four decades in commercial lending, I’ve learned to pay attention to the quiet shifts like small percentage drops. When interest rates fall and inflation still hovers, cash sitting idle in a money market account starts to lose its value. For individual investors, this isn’t just frustrating, but it’s financially damaging.

If you’ve noticed this happening with your own accounts, you are not alone. Many of our clients have recently contacted us expressing similar frustrations. That is why more investors are turning to private credit as a more efficient, yield-generating solution for their capital and portfolio.

The Hidden Cost of “Safe” Accounts

Money market and savings accounts have long been seen as “safe” places to keep cash. But in today’s environment, that safety comes with hidden costs.

Once you factor in inflation and taxes on interest earned, the real return on these accounts is often close to zero or even negative. The interest earned is taxed as ordinary income, and with inflation still hovering, the value of your cash is declining.

What was traditionally seen as a safety net is now a slow leak. Every month your money sits in a low-yield account, it’s worth a little bit less. Over time, that decline steadily reduces what your cash can actually buy.

What Private Credit Offers Instead

Private credit has always been a space where savvy investors seek higher yields with real security. These aren’t risky investments. They’re short-term loans backed by real estate or business assets, structured with a clear exit strategy and a solid collateral base.

We routinely see double-digit returns in this space, and the transactions are often much more straightforward than most people realize. For investors looking for a more productive use of their capital, private credit will offer a far better risk-adjusted return than any bank product available today.

What Smart Investors Already Know

This isn’t a new trend. Seasoned investors have been active in the private credit space for years. They understand the value of putting their capital to work in well-structured, asset-backed deals.

What’s changed recently is accessibility. It’s now easier than ever for individual investors to gain exposure to this asset class. If your money market isn’t doing the job anymore, it may be time to follow the lead of those who have already made the switch.

How Smart Portfolios Adapt to Rate Cycles

The most financially savvy investors aren’t just reacting to falling interest rates; they are reallocating. As traditional bank products decline and inflation continues to steady, smart portfolios are moving toward more productive alternatives. Private credit has become a go-to strategy to reposition idle capital into income generating (and asset-backed) investments.

At Worth Avenue Capital, we’ve spent decades structuring these types of deals with a clear focus on both return and risk mitigation. Every loan we fund is grounded in real collateral and guided by a defined repayment strategy. If your cash is sitting idle and loosing value, now is the time to consider an upgrade to high-performing investment option.

Let’s talk about how private credit can be added to your broader portfolio strategy and help it perform through every rate cycle.