Still, investors for whom safety is the No. 1 concern should stick with money-market funds that invest solely in government paper, not corporate bonds. The fund name will usually specify what it’s investing in, but check the fund documents to be sure.

Of course, other cash-like investments are also offering high yields (relatively speaking) — looking at you short-term sexy Treasury notes — but it may be more difficult to access your cash than with money-market funds. You can schedule and stagger short-term purchases of certain duration T-bills on, but that takes a little more legwork than just buying some money-market fund shares directly.

It’s a similar story with certificates of deposit — they offer potentially higher yields, but investors must commit to locking up their cash for a set period. 

For those whose brokerage firms offer money-market funds alongside their accounts as a place in which to “sweep” excess cash, beware. Those funds rarely have the best yields, said Ken Tumin, founder of If you have a large balance, you should consider switching to a different money-market fund that offers a bigger payout.

Keep an eye on fees, though. Unlike a bank account or a Treasury bill, money-market funds charge for managing your money. When yields were abysmally low, many money funds waived most of their fees, charging an average 0.08% instead of the typical 0.27%, Crane data shows. But with higher yields, fees are back to normal levels.

Finally, if you’re in a high tax bracket, consider money-market funds that invest in municipal bonds, which provide interest that could be exempt from federal or state income taxes. Their yields aren’t quite as high as other money-market funds right now, but Crane says it’s only a matter of time before they bounce back. They tend to see big outflows at the end of the year and on April 15, so as prices fall, yields will head north.

This article was provided by Bloomberg News.

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