That's the most likely place for today's one-year investors to move. You get the government guarantee plus frequent access to your money. Right now, three-month bills yield 4.76 percent. Those who won't need their money for a while might consider two-year Treasury notes. Usually, the longer-term notes yield more.
Treasuries offer a tax advantage, especially to investors in highly taxed states.
You pay only federal tax on the interest, not state and local tax. You can buy Treasuries directly from the government. Treasuries are also available through banks and stockbrokers, but there's no point paying a commission when you can buy them free. Still, many investors today are choosing to keep their savings somewhere else. Options include bank certificates of deposit, money market funds and other government securities.