AGES 35 TO 55: TURNING CONSERVATIVE

You're in transition: saving for retirement and college costs but beginning to shift to preserving assets.

In the recession, be sure to have a cash cushion--in money-market funds or short-term certificates of deposit--to cover at least one year of living expenses. To boost cash, consider trimming your contributions to retirement accounts. If you are a homeowner, another option for raising cash is a home-equity line of credit, which can still be had for around 5.5%. The interest is tax-deductible. For yields on cash instruments, check out Bankrate.com.

Tuition bills on the horizon? If you live in one of 35 states that offer tax deductions on 529 plans, open one up. Compare plans at Savingforcollege.com.

Evaluate your retirement plan against your goals using the "Ballpark E$timate" retirement calculator at Choosetosave.org.

Keep your investments geared toward growth--you still have a long investment horizon ahead--but start building an income portfolio with blue-chip stocks, many of which yield 3.1% or more. If you are in a high tax bracket, acquire some municipal bonds with outsize yields. If you can stomach risk, consider allocating 5% to high-yield bonds, which typically yield 8% or more. And begin to diversify into noncorrelated assets, such as market-neutral funds, managed futures, and even commodities, to protect your stock holdings.