The Wall Street Journal published "Prepare for New Money Market Fund Rules," which outlines three things investors should know about upcoming changes to money funds. The article says, "1. Understand types of funds. Money funds can be divided into three categories according to their investments: prime funds; "government" funds, which invest in U.S. government and federal agency debt; and municipal funds, which invest in the debt of state and local governments. The new rules will create another distinction: Many money funds now mingle the investments of institutional and individual, or retail, investors. But because the new rules make a distinction between institutional and retail investors, fund companies are working toward separate institutional and retail funds. Understanding all these distinctions is important because institutional funds will be subject to more rule changes than retail funds, and government funds will be subject to fewer changes than prime or municipal funds. Those differences in the new rules will drive the changes fund companies make in their funds' investments and structure. 2. Know what you want Money funds are yielding little -- currently an average of 0.03% a year, or $3 on a $10,000 investment, according to Crane Data LLC, a money-fund research company. But government and municipal funds typically yield even less than prime funds. That's because prime funds are able to invest in a wider range of securities. That leaves investors with a choice: Should they invest in a fund that could earn more but be more risky, or put money in a safer fund that will probably yield less? Many investors will confront that choice as their funds switch from prime to government funds. 3. Watch the paperwork. Fidelity and Federated are also merging several of their money funds, meaning some funds will cease to exist. Typically, this should be an easy process for investors, who will automatically be moved into the new fund, with no tax implications, fund companies say. But investors should make sure the new fund is investing in the same way."

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