Though the Federal Reserve continues to refrain from moving short-term interest rates higher (or lower), there does appear to be a slight uptick in interest about cash rates from the financial press. Following a brief drought of stories on money market rates, a pair of new articles appeared over the weekend. Kiplinger's Personal Finance writes on "33 Ways to Get Higher Yields" while Barron's writes on "Where to Stash Your Cash Now That Rates Have Moved Up."

Kiplinger's John Waggoner comments, "For more than a decade, income investors have been plagued by paucity wrapped in misery.... Although the Federal Reserve has nudged its target interest rate range to 2.25% to 2.50%, it has signaled that it's done raising rates for now.... Locking your money up for longer periods is rarely worth the negligible increase in yield. What could increase your yield these days? Being a little more adventurous when it comes to credit quality. When you're a bond investor, you're also a lender, and borrowers with questionable credit must pay higher yields."

He explains, "Despite such caveats, income investing is not as bad as it was in 2015, when it was hard to milk even a penny’s interest out of a money market. Now you can get 3.3% or more from no-risk certificates of deposit at a bank.... Short-term interest rates largely follow the Fed's interest rate policy. Most observers in 2018 thought that would mean higher rates in 2019. But slowing economic growth in the fourth quarter of 2018 and the near-death experience of the bull market in stocks changed that. The Fed's rate-hiking campaign is likely on hold for 2019."

The Kiplinger's piece continues, "Still, money markets are good bets for money you can't stand to lose. Money market funds are mutual funds that invest in very-short-term, interest-bearing securities. They pay out what they earn, less expenses. A bank money market account's yield depends on the Fed's benchmark rate and the bank's need for deposits."

It tells us, "Money market mutual funds aren't insured, but they have a solid track record. The funds are designed to maintain a $1 share value; only two have allowed their shares to slip below $1 since 1994. The biggest risk with a bank money market deposit account is that your bank won't raise rates quickly when market interest rates rise but will be quick on the draw when rates fall. MMDAs are insured up to $250,000 by the federal government."

The article adds, "The best MMDA yields are from online banks, which don't have to pay to maintain brick-and-mortar branches. Currently, a top-yielding MMDA is from Investors eAccess, which is run by Investors Bank in New Jersey. The account has no minimum, has an annual percentage yield of 2.5% and allows six withdrawals per month. You'll get a bump from a short-term CD, provided you can keep your money locked up for a year."

This weekend's Barron's comments, "It was tough to be a saver in the 10 years after the financial crisis, with ultralow interest rates making traditional cash parking places, including short-term Treasuries, about as lucrative as your sock drawer. But the Federal Reserve has raised short-term interest rates seven times since the start of 2017, from 0.75% to the current 2.5%, effectively ending the yield drought." They quote Morgan Stanley advisor Scott Siegel, "For the first time in a long time, cash or cash equivalents are paying you something.

The article continues, "It's about time. Low interest rates -- engineered by the Fed in the wake of the financial crisis -- cost savers as much as $600 billion over the years, figures Mike Mayo, a banking stock analyst. Those looking to park cash for relatively short periods -- say three to 18 months -- can now choose from a number of options yielding more than 2%, while maintaining ready access to their money. Short-term U.S. Treasury bills, Treasury floating-rate notes, or FRNs, and short-term government money markets are worth considering, advisors say."

After discussing Treasuries and Floating-Rate Notes, Barron's adds, "Also worth a look: short-term government money funds, which invest in government securities, such as Treasuries and debt from federal agencies. They may yield less than traditional taxable money funds, but as long as they invest solely in government securities, all of their income is exempt from state and local taxes. Check out Vanguard Federal Money Market (VMFXX), currently yielding about 2.4%. The leading discount brokerages all offer screening tools to find the best government money-market funds."

Finally, they write, "We'd be remiss to leave out bank savings accounts, which also sport improved yields. CIT Bank, for instance, recently offered an annual percentage yield of 2.45%. The catch with bank savings accounts: Rates can change at any time without notice, and the interest is taxable."

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