21 ways to stomach a sour market

The whole point of stashing part of your portfolio in cash - that is, in a CD, a bank money-market account or a money-market mutual fund - is to protect it. So there's no reason to expose this money to losses.

Sadly, investors who've been saving in "cash equivalents" have discovered there's no way to grab for more yield without getting a fistful of extra risk.

Short-term bond funds - sometimes used as money fund substitutes - are down more than 1% this year. Ultra-short-term bond funds have lost nearly 3%, partly because of the mortgage mess.

Yet you don't need nontraditional accounts to earn decent yields. With the Fed likely to raise rates soon, money fund yields, now about 1.9%, could climb. Some online banks are already beefing up savings offers. HSBC Direct extended a 3.5% yield, originally set to expire in August, to mid-September.

NEXT: Keep expenses low, low, low