In particular, US municipal bonds have been considered attractive given their solid yields and tax advantages. Look for expense ratios well below 1 percent, and, when possible, in the 0.35 percent to 0.85 percent range, experts stress. US savings bonds, often derided by investment advisers, are in fact quite competitive now, yielding about 5.5 percent for Series EE bonds. I Bonds, designed to offset inflation, currently yield 6.49 percent. But remember, there is a penalty for cashing out savings bonds before five years.
Fees can add up over time.
Fortunately, some money funds waive fees and still offer very high yields. But if they do, make sure their portfolio is not packed with junk-bond issues of B grade or less. Very few money funds have had financial trouble over the past decades. And even when they have, investors have not lost much money. But they currently only yield between 3 percent and 4 percent.