Strategies for finding decent yields while minimizing risk. Getty Images By the editors of Kiplinger's Personal Finance From Kiplinger's Personal Finance, December 2017 Signaling confidence in the economy, the Federal Reserve will trim the $4.5 trillion securities portfolio it amassed in the wake of the financial crisis and continue boosting short-term interest rates; we expect two hikes in 2018. Long-term rates will inch higher. Given the Fed’s slow and measured pace, the challenge remains finding decent yields without taking on undue risk. SEE ALSO: 5 Investments Yielding 5% or More Kiplinger's Best List, 2017 Best FAANG-less Stocks 3 Best International Mutual Funds to Play the Global Economic Recovery Best Ways to Make the Most of Rising Interest Rates Best Ways to Get Free Trades at Online Brokers Best Vales in Tech Best Health Savings Account Best Phone Plans for Every Type of User Best Benefits of Amazon Prime Best Ways for Investors to Play Defense Best Rewards Credit Cards The Best Bank for You Best Tax Software for You Best College Majors for Your Career Best College Savings Plan Savers can eke out the best yield on a rainy-day fund with insured savings or money market deposit accounts from internet banks, which have been the most responsive to the Fed’s rate hikes. The Redneck Bank Mega Money Market Account recently paid a 1.5% rate. If you can lock up cash for a while, CDs have appeal. With a $5,000 deposit, you could recently nab 1.6% on a one-year CD or 2.6% on a five-year CD (among nationally available certificates). With rates edging higher, it’s wise to build a CD ladder by spreading money among CDs of varying terms and reinvesting at a higher rate as each CD matures. Or choose CDs with minimal early-withdrawal penalties. Ally Bank recently offered 1.5% on an 11-month No Penalty CD with a $25,000 minimum deposit. Bond investors can stay flexible with a multisector bond fund. We recommend Pimco Income (PONDX, 3.6% yield), a member of the Kiplinger 25. It favors a “barbell” strategy, balancing high-yield debt on one end with high-quality bonds on the other. Or you can check out another Kip 25 fund, DoubleLine Total Return Bond (DLTNX, 3.2%), which invests in a variety of mortgage bonds.