How to Beat the Fed at its Own Game

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--Bonds. Bond prices fall as long-term rates rise, and the moves are sharpest as you move out on the yield spectrum. Stay away from 30-year bonds until it's clear that long-term rates have peaked. A better bet--one that will lend your portfolio stability, win big if long-term rates fall soon and yet won't hurt much if rates tick higher--is bonds with maturities of three to seven years. Consider an intermediate-term bond fund. "They give you 95% of the yield of the long bond [30-year] with only two-thirds of the risk," says Tom Orechhio of financial planners Greenbaum & Orechhio in Oradell, N.J.

--Auto leasing. A leasing company may get a better rate than you can and pass it through. A lease may make sense if you are on a tight budget, because leasing companies can finagle the residual value and term length to reach the same payment you might have got last year. Careful: such a lease may cost more over the length of the lease. This is the brave new world of higher interest rates. It doesn't mean the good times are over, but the party is certainly winding down.