That really depends on your local state tax situation. Fidelity has a great tool to compare yields of differently taxed fixed income options here. Basically:

• t-bills are not taxable at the state level
• municipal bonds are generally not taxable at the federal or state level
• CDs are taxable at the federal and state level

So that's why I park my savings in t-bills, I pay state income tax, and t-bills have a higher after tax return than CDs, and are more reliable than municipal bonds. The money that needs to be a little more liquid is in a money market fund.

How much cash

I don't hoard cash, so it's only my efund and my slush fund (i.e. the money that I've charged on my credit card or expect to pay in bills this month).

My money market fund yields 4.97% last I checked, and I think t-bills are >5% right now.

My total portfolio is almost entirely stocks, outside that efund, with any 75% US stocks and 25% internal stocks. My target is 70% US, 30% international, but I haven't bothered rebalancing yet this year so it's a bit lopsided.

Most of my savings is in IRAs, which are mostly invested in Vanguard index funds. I try to keep about what I’d need to live on for a year in short-term investments and high-yield savings, any extra in some longer-term investments. I have a couple of CDs, some T bills, an I bond, some stocks. I’ve been shifting money around lately depending on where the best interest rates are.

Bread Savings has a 4.88% rate (5% APY) right now, no fees. The T bills have rates between about 5.3% and 5.5%. Right now, even 4-week T bills have rates over 5%.

SNAXX is yielding 5.37%.

It really depends on why you’re holding the cash though- how long you plan on sitting on it. At some point it probably makes sense to lock in a longer duration t-bill/note.

I generally avoid holding cash unless there’s a specific spending goal in the next 3ish years.