I'm FIREing early next year so I decided I wanted to have ~2 years minimal expenses in cash due to the high stock market valuations. If stocks tank, I'll spend from the cash and not have to sell stocks when they're down. Maybe not ideal for long term growth but I sleep soundly with this set-up, and I am confident I will not panic in the event of a downturn.
I have about 1 year's worth of this money in 4 different 12-month CDs, one set to turnover every 3 months. They'll just keep auto-renewing if everything is ok, but I figure if things get hinky and I feel the need to start using the cash instead of selling stocks, I'll never have to wait very long for one of the CDs to mature, thus relieving me of worrying about cashing it out early and losing interest. I have other cash in various sinking fund accounts I can always tap if I need something ASAP.
The second year's worth of cash is split between a 5 year CD and a Money Market in one of our IRAs. I chose the 5 year CD just to maximize the interest rate when things are good. If I really need the money I'll just have to sacrifice a few months of interest to cash out the CD. The IRA cash isn't a lot, but I just did it so I'd have the full 2 years worth of spending in cash.
I use Ally Bank for all my CDs because they have good rates and are easy to use. I've been with them for several years now (have a savings account there too) and have been quite happy with the rates and their online services.
Honestly I think my system is probably way more convoluted than necessary, and I know I am not maximizing returns, but my primary goal with this money is to help me feel secure through an eventual downturn and it works for me. If I was completely rational I'd probably just put it all in a 5-year CD to get the maximum interest rate and accept the small risk of losing a few months interest should I need to cash it out early.