(MONEY Magazine) – Two years of Fed rate hikes have left savers happy and many borrowers squirming. With the autumn lull in rate hikes looking to last into 2007--and even to reverse--you may want to rethink your savings and credit strategies.

• SINGLE BEST IDEA Buy a long-term CD to lock in a high yield. While the Fed was driving up rates, you didn't want to tie up your cash in a CD for fear of missing out on a better deal later. New year, new plan: It's time to grab a yield of as much as 5.5% for a year or more, risk-free. (For the top-yielding CDs, see page 58.) "Even if the Fed raises rates one more time, we're close to the top," says Greg McBride, a senior financial analyst at Bankrate.com.

Another good bet for the cash portion of your portfolio is short-term bond funds, which yield 4.7% on average. These funds suffered as bond prices fell, but if interest rates drop, prices will climb. "Next year, investors could see yield, plus a little extra return," says Morningstar analyst Scott Berry. Two consistent high yielders: USAA Short Term Bond (USSBX) and Vanguard Short-Term Bond Index (VBISX).

In 2007, figure that money fund rates will move in lockstep with the Fed. Once rates start falling, however, you may find better savings deals at online banks because competition for deposits is fierce.

PAY OFF YOUR BALANCE. Credit-card holders suffered in 2006 as the average rate rose to 14%. Issuers should leave rates alone in 2007. Trouble is, you are still paying 14%. Beware of balance-transfer offers that run out quickly or carry high fees. Look instead for a low ongoing rate. American Express Blue card (800-223-2670) charges 4.99% on the life of a balance transfer.

FIX YOUR MORTGAGE. While variable-rate loans have become more costly, fixed mortgages have stayed cheap. Today you'll pay nearly the same rate on a 30-year mortgage as you would on a five-year ARM. If you're getting a new loan, make it a 30-year fixed. If you have an ARM, though, "you've likely borne the worst of the pain," says Keith Gumbinger of HSH Associates. It's a good time to refinance if your payments are hard to handle. But with rates not expected to rise much, you can be patient.

The View 2007

Saving pays off big

Money fund rates: 4.5% to 5.5%

Average rate on credit cards: 14%

SOURCES: Crane Data, IndexCreditCards.com.