Dear Dr. Don,

My financial adviser has recommended moving my certificates of deposit (CDs) into an ultra short-term money market account. The rate is higher. Should I? Are these things safe?

-- Elle Elicits

Dear Elle,

A money market account, or MMA, is a high-yield savings account. It also is a bank product and as such is insured up to the $250,000 limit set by the Federal Deposit Insurance Corp. for those deposits. You can shop rates on Bankrate.com using its "compare rates" tool.

Moving money out of a CD is problematic if you have to pay early withdrawal penalties. To pay a penalty to invest in a bank's money market account isn't likely to make financial sense. If you have CDs that are maturing, that's a different matter.

I'm thinking it's possible your financial adviser is actually recommending ultra short-term bond mutual funds instead of a money market account. These mutual funds wouldn't have an FDIC guarantee. Yield-starved, conservative investors have moved money into these funds from money market mutual funds, but they're not without risk because they lack FDIC protection. You'll need professional advice in choosing one of these funds.

My advice would be to invest in bank products over a short-term investment horizon of one to three years rather than investing in ultra short-term bond funds.