What do you do with money that you want to be able to access quickly when needed, such as your emergency fund? Hide it in the cookie jar? Stuff it under the mattress? Sometimes it's difficult to decide.

If you put it in a certificate of deposit, you may incur penalties if you have to withdraw it early. If you mingle it with your checking account, you're more likely to dip into it. Your savings account may not earn a very good interest rate. Under your mattress or in your cookie jar are really not viable options. So where is the best place to stash your cash?

Checking and Savings Accounts

Savings often end up sitting in the checking account just because it's the easiest option. It's not a good idea, though. Savings should be segregated from your day-to-day spending money for several reasons, including the fact that it's much too easy to dip into your savings if they're mingled with your checking account. You'll also earn better interest in a nonchecking account.

Savings accounts, like checking accounts, are safe if the bank is FDIC-insured, and usually pay higher interest rates than checking accounts. Savings accounts are a good place to park some of your savings, but only as much as you would need in the short term in an emergency. Because savings-account interest rates may not keep up with the rate of inflation, you actually lose money in the long run.

Internet Bank Accounts

If you want to try for a higher yield, you might look at Internet bank accounts. One of the most attractive features of these accounts is the high interest rate they pay on deposits, plus they may have no minimum balance requirements. Keep in mind that it can be difficult to get cash out of these accounts, so don't put all your eggs in an Internet bank basket. It may take a few days to electronically move money from your Internet bank account to your brick-and-mortar account. However, you may be able to get your cash via a check on the account or an ATM/debit card.

Money Market Deposit Accounts

Money market deposit accounts, offered by most banks, are also FDIC-insured. They usually require a minimum balance of $1,000 or more, but they pay slightly higher interest rates than traditional savings accounts.

Certificates of Deposit

CDs are actually loans you make to the bank for an agreed-upon term in return for a guaranteed interest rate on your principal. Some have adjustable rates tied to an index such as Standard & Poor's 500 stock index. Most CDs charge a penalty if you withdraw all or part of your funds before the maturity date.

Like other bank accounts, CDs are insured up to $100,000 as long as the bank is FDIC-insured. The $100,000 refers to the total of your accounts with that particular bank, so if you have more than $100,000 in one bank, you're not fully protected.

CD terms range from one month to five years or more. The longer the term, the higher the interest rate and the greater the risk that your money will be locked up at a lower rate when interest rates rise. As with any investment, you have to balance the risk with the reward and make a decision within your comfort level.

Banks and brokers also offer callable CDs with rates that may seem too good to pass up, but be sure to read the fine print and ask plenty of questions before investing in a callable CD. Be sure you know the difference between the maturity date and the callable date. Usually the issuer has the right to call the CD at any time after one year, but this doesn't mean it matures in one year. It may be a twenty-year CD, which means you can't cash it in without a penalty for twenty years, but the bank can call the CD at any time.

If interest rates have risen since the CD was issued, the bank will keep the CD in force because the rate will be below the current market rates. If interest rates have fallen, the bank will call the CD so it doesn't have to pay you above-market rates. This leaves you with money to invest at low rates when you may have thought you were locked in at a higher rate for a longer period.