If you're worried about the stock market and are looking for an alternative to risky investments in the short term, then you have several options. You don't have to store your money in a savings account; there are alternatives that pay slightly more than one of these. Here are 3 of the best options.

Money Market Account

A money market account is very similar to a savings account, but with a few minor differences. First, a bank may have a higher limit on the amount of money needed to open a money market. Secondly, banks can use money from money market accounts to invest in several different areas. Money from a savings account is only used to make loans. The increased flexibility the bank has with money market funds is the reason that money market accounts pay a slightly higher interest rate than savings accounts; the bank is able to invest in more speculative and profitable investments with money market funds.

You can withdraw your money from a money market at any time. Most banks will want to limit you to six withdrawals a month. In order to impose this limit they might charge fees for the withdrawals that exceed the limit.

Certificate of Deposit

A certificate of deposit, also called a CD, is FDIC insured. This means you won't have to worry about your money disappearing due to a badly timed investment on the bank's part. CDs will pay higher interest than money market accounts, but there is a catch. Your money will be "locked up" for a set amount of time. Once you put the money in the CD, you cannot withdraw it without penalty until the expiration date. There are CDs that are for 3 months, 6 months, 12 months, and even two years. Generally speaking, the longer the term, the higher the interest.

When looking for a CD, it pays to shop around. Some banks will offer a slightly higher interest rate than others for CDs of the same duration. Because they are all FDIC insured, it pays to search for the bank that pays the highest rate. There is never a risk of your losing the initial investment, so you should shop around for the highest return on your investment.


T-bills (or Treasury bills) are issued by the federal government, specifically the Treasury department. You can think of them as short-term bonds. They come in 1-month, 3-month, 6-month, and 1-year durations. They are similar to CDs in that you cannot withdraw your money before the expiration date. You can buy these directly from the Treasury department. They are a very safe way to invest money in the short term while waiting for a bigger investment opportunity down the road.