Ever since late last year, the Federal Reserve has kept its target overnight lending rate among banks in a band between 0 percent and 0.25 percent. Therefore, money market funds have had scant yields.
Recently, for example, average yields have been in the 0.25-0.30 percent range.
If you want higher yields on your cash reserves, what can you do?
* Shop for higher yields. At www.imoney.net, you can see which money market funds have above-average yields. Vanguard Prime, for example, recently was paying 1.30 percent.
* Ladder CDs. At www.bankrate.com, you can see which banks have the highest yields on CDs. You might put some money in a three-month CD, some in a six-month CD, a nine-month CD, a one-year CD, etc. Some one-year CDs now pay as much as 2.8 percent.
Of course, CDs are among the bank accounts covered by federal deposit insurance, up to $250,000 per depositor per bank. So your money will be safe, if low-yielding. When yields turn up again, you’ll have maturing CDs to provide money you can reinvest at those higher rates.