Q I just sold my townhome and have around $130,000 to invest. I need to keep the principal and earn some interest. I am now living with my sweetheart, but this money will be needed for future renting or buying if anything happens to him. I am considering certificates of deposit (CDs). But are there other, more creative things I can do? I plan to have $25,000 of that money accessible for an emergency. I have an IRA in Vanguard, which has 10 percent stock, 50 percent bonds ... and a rollover in its Prime Money Market. I always was very heavy in stocks when I was still working, so this is a very different scenario for me. JOANNE

A The legendary investor Benjamin Graham once wrote that when challenged "to distill the secret of sound investment into three words, we venture the motto: 'margin of safety.'"

Those are wise words for all seasons, but especially at an unsettled time like this. Plus, you may need access to the money within a fairly short period of time.

Normally, I would recommend investing in U.S. Treasury securities. They're default-free. They can be bought in small denominations. You can buy them directly from the U.S. Treasury. And, in more typical times, you would also earn a decent rate of interest.

But today? The Federal Reserve has lowered its benchmark interest rate to between 0 percent and 0.25 percent. I'm writing this column on an airplane -- but before I boarded I checked and the yield on the three-month T-bill is essentially zero, and the yield on the 10-year Treasury bond about 2.2 percent.

That's why many savers can do better, even after taxes, investing in CDs. A number of online banks are offering decent rates to savers, too. (Decent means at somewhere between 2 percent and 4 percent, so you're doing better than Treasuries.) It isn't an issue for you with the amount of money you have to invest, but for anyone putting money into a bank, make sure you stay under the $250,000 limit on FDIC insurance (or its credit union equivalent federal safety net).

While your money is safely parked away, I'd recommend taking the time to look at your portfolio as a whole. Most of us think about our money in separate categories, such as retirement savings and emergency stash. The question is: Do you have the right asset allocation for your needs and goals? You may want more, less or the same percentage in stocks and fixed-income securities.

I'd also look into whether you should rebalance your overall portfolio in light of the strong performance in government bonds and the abysmal returns in stocks.

Chris Farrell is economics editor for American Public Media's "Marketplace Money." Send questions to cfarrell@mpr.org, or to kaching@startribune.com. Put "Your Money" in the subject line.