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It all depends on whether your money is tax sheltered (401, IRAs...) or not. Also, whether the money can be left to grow for five to ten years or if you will need it right away. If you don't have any education on the subject of investments I would start by parking the money. Go to Vanguard.com and investigate their short term funds. For the longer range, you will need to educate yourself. Try Vanguard.com and look at the "insights" section. Try the book "All About Asset Allocation" for starters. Look at "Money Talk" list of books to read. Try Ric Edelman's website under Education.

Oldbuddy,

That's my feeling too. There is risk and then there is calculated risk with diversification. Are you doing HYIP's?

With me since I'm still working I put a little each month into stocks and in reality 'penny stocks' - I'm one of those that goes by the axiom - 'no risk no reward'. All of these 'pennys' are viable firms that have a very good product and all three have signed contracts and are still selling.

I've kept a couple actively managed stock mutual funds at the core of my privately held assets. One is a Health sector fund and the other a well respected growth fund. Still hold about 15% in Money market for opportunity and emergencys. Keep about 35% in raw stock which I wrangle personally. Hold stuff as staid as Altria to as speculative as Clean Energy Systems and RFMicro. May get back into rolling stock again soon, if things fall into place.

My 401K limits my choices considerably, but keep about 1/3 of those funds offshore. The declining dollar and decay of the domestic tax situation combined with new excessive regulation pretty much demands guarding against too much American stock exposure. Have a little in a bond fund (which I'm rethinking). Have the rest in Midcap and a balanced fund. Putting a smidgen into the company stock (which is the only individual stock I am allowed to own in the program.)

1/2 of my taxable cash is in the Vanguard tax exempt MMF and 1/2 is in the Vanguard short-term bond index fund.

never had any luck with funds! don't like them--I am in stocks and short term bonds-If you research fully you can find bonds with 6-9 %. munis are tax free-I do all my trading on line with ameritrade and use their research info..Its great! Also look into checking accts making 3.50%. You need to use your debit card and pay bills on line, but you can use these accts as a savings acct. They work great.

I started buying stocks by investing in DRIPS-You get in touch with a stock co that you like (GE-COCACOLA-INTEL) anyone you like-You start an accout with them and send them money each month. when they get enough to buy a stock , they do and notify you. This is how I started my grandchild when she was 11 yrs. She sold her stock at 19 years old and bought a car. Now she is starting all over again with 2 different companies. If you need more info write me.

for returns of 6.5% and up check out Master Limited Partnerships.

OP is talking about where to stick cash. MLP is a speculative long-term asset class that may not be the best place to invest short-term money. Currently (May 2011), CD's and savings accounts seem to best place to stash S-T money to me.