Finding the best interest rates in today’s economy can be a challenging endeavor. If you are asking yourself “when will interest rates go up?” you might be realizing that they have been low for some time with no end in sight. If you do want to earn interest income that is safe, these are your options:

Bank CDs

A bank CD or Certificate of Deposit. A CD is offered to the public by most commercial banks and credit unions. They are insured either by FDIC or a private insurance company and therefore are considered risk-free. CD has come with a fixed term. The terms usually range from 3 months to 5 years and carry a fixed interest rate. If the CD is held to maturity, the account may be redeemed for the dollar amount invested plus any accrued interest. If one withdraws the money before maturity, there is usually a substantial penalty. For example, if one has a long term CD, typically three to five years and closes the account before the end of the term, there can be a loss of up to six months worth of interest.

Money Market Accounts

A money market account is a savings vehicle offered through a bank or a brokerage house. The best money market interest rates have typically been higher than savings accounts and have offered investors a nice alternative to a bank savings account. Money markets invest in short term obligations and are therefore a stable investment vehicle. They also offer check writing privileges, but in many cases the there is a minimum amount that the check can be written for. Minimums usually range from $100 to $250. Due to certain government restrictions, an account holder is limited to a maximum of six transactions per month.

Treasury Bills

A treasury bill is a debt obligation issued by the U.S. government and matures in less than twelve months. They can be purchased in denominations of $1,000 and have a maximum purchase limit of $5,000,000. The bills are purchased at a discount from the face value. The rate of return on a treasury bill depends on the amount of discount you receive, and the amount of time held. For example, if an investor buys a treasury bill that has a face value of $10,000, but pays a discount rate of $9,700 and the maturity date is in six months; his rate of return would be 3.09% for the six months he held the Treasury bill. The investor will receive the face amount of $10,000 at the end of the six months. Since the investor only paid $9,700 for the bill and he received back $10,000 when he cashed it in, he made a profit of $300 in six months.

In conclusion, a well-informed investor will consider all his options even when it comes to short term investing. With a downturned economy even a passbook savings account is a better investment vehicle than some types of assets.  Even though interest rates are fairly low in the current economic environment, the three options listed above can still provide a modest return.