MORE THAN HALFWAY through the year and seemingly countless sucker rallies later, investors are getting tired of sitting in cash. With short-term interest rates skimming the surface at 2%, it's tough to get much of any return on your money, especially in the old stalwart of money-market mutual funds.

At first glance the yield on even the most remunerative of these funds looks rather dismal, but depending on your circumstances they still might have a place in your portfolio.

Money-market mutual funds, which come in both taxable and nontaxable flavors, have long been a favorite parking place for cash. Primarily investing in corporate, government or municipal debt with maturities of less than 90 days, they're safe, secure and liquid.

But after taking a look at their yields, which are measured over a seven-day average because securities in the funds change so frequently, we were underwhelmed. After all, why settle for, say, 2.42% from Fidelity Cash Reserves when there are online savings accounts paying 3.5%?

One reason you might allocate to a money-market mutual fund, especially a nontaxable variety, could be your tax bracket, says Shashin Shah, certified financial planner with SGS Wealth Management, based in Dallas. "The savings account may look good," he says, "but if you're able to go to the equivalent tax free, you could get a better return savings-wise than with a taxable account."

Another important consideration is protection if your institution fails. A money-market mutual fund is a security (unlike a money-market account, which is a kind of savings account). Buy the fund through a firm covered by the Securities Investor Protection Corp. (and you should only buy securities from an SIPC member firm), and you'll be made whole up to $500,000 in securities and $100,000 in cash should your brokerage go bust. By comparison, the FDIC insures your deposits like those found in a money-market account only up to $100,000, or $250,000 for retirement accounts.

Then there's the greed factor. We're all for maximizing yield, but let's not forget that the S&P 500 is off more than 10% this year. Suddenly, two or three percentage points of growth don't sound so bad.

Top Yielding Money-Market Mutual Funds*

TAXABLE FUNDS	7-Day Effective Yield	Minimum Investment	Expense Ratio
	2.42%	$1,000	0.44%
	2.42%	$2,500	0.43%
	2.38%	$2,500	0.25%
	2.31%	$1,000	0.74%
	2.29%	$1,000	0.63%

NONTAXABLE FUNDS	7-Day Effective Yield	Minimum Investment	Expense Ratio
	2.61%	$2,500	0.32%
	2.28%	$3,000	0.17%
	2.14%	$1,000	0.37%
	2.09%	$1,000	0.29%
	2.08%	$1,000	0.43%

* Of funds open to individuals that don't require a prior account with the institution. As of July 30 Source: Bankrate.com

GOT A FINANCIAL GRIPE?
SEND AN EMAIL TO THE IRRITABLE INVESTOR AND WE'LL CHECK IT OUT.

Also See:
Get Better Yields Without ARPS-Like Risk
Where to Find the Best Savings Rates
Best and Worst S&P 500 Index Funds by Cost