About 20 years ago I bought a stock in a small company that made bar code scanners. Hey, why not? I thought to myself. I'm a smart guy! I'm a CPA! I can do just as well as those jerks on Wall Street, right? I researched the company's background, read the latest SEC filings, did my due diligence. I made all the right moves, took all the right steps. After buying the stock I checked the price every day in the Wall Street Journal. And nothing much happened for about six months. Until something did.

That something occurred on a Monday in November of 1997. The stock dropped 40%. I learned that the company's management were off in their forecasts (oopsie!) and sales were coming in much lower than expected. Not surprisingly, the major investment banks and holders of the company's shares dumped their holdings moments after the news was released. Me? I didn't hear about it until....Tuesday when I checked the price. So I sold for a big loss. It was then that I realized that investing my company's cash in the shares of someone else's company may not be a great idea. And I suggest the same for you. Here's the reality: CEOs and Wall Streeters are just as clueless as we are. But when it comes to our own companies, we're just a little less clueless.

So if you've got a few extra dollars in your company's bank account, don't buy somebody else's shares with it. Instead, consider these more potentially more profitable alternatives.

Buy inventory.

Say you've got $10,000 extra to invest. You could buy stock in a publicly traded company and cede control to them. Or you can keep 100% control of your money and invest it in something you know even better: the products you sell. You've been doing this for a while. You know where the bargains are. You know what your customers want. And you know which cash-starved vendors would gladly offer you a sweet deal for a big upfront payment. A $10,000 inventory buy, assuming you've got the place to put it, may sit there for a while until you get the right deal. But then you can easily sell it for maybe $15,000 or $20,000 and, even considering overhead, earn a 10-20% return on the investment. Are you going to see that in a publicly held stock? No, you're not.

Invest in property.

Where do the super-rich put their money? Real estate. And for good reason. Ask any fan of Monopoly and you'll learn that owning is much more profitable than renting. So why are you renting your space? Consider taking that extra cash and putting it towards a property for your company to use. Interest rates are at rock bottom and your mortgage payment, particularly over 15-30 years, may wind up being the same, if not less, than what you're paying in rent. Except that you're paying yourself. It's likely that your property will appreciate over time--most do if you buy in a decent area and avoid speculation. And the sooner you pay things off the quicker you'll be unburdened from one of the biggest drains on your monthly overhead: your rent. Don't want to disrupt your business? Then diversify your cash, buy some rental property and create another income stream.

Upgrade your equipment and technology.

There's a big change in the workforce going on right now. Don't believe me? This report says that there will be 21-25% less metal/plastic forging and extruding machine setters and operators, 32.9% less switchboard operators and 33.7% less postal-service mail sorters, processors, and processing-machine operators...all in the next 10 years. Wendy's recently announced it will be installing self-serve kiosks in its 6,000 locations and Amazon is turning its warehouses into robotic farms. These industries, and others, are investing in new equipment and technologies with the intention of reducing headcount and therefore overhead. Go to your industry trade show, visit others in the field, and consider a few good investments with your excess cash that could pay off even five or ten years from now.

Upgrade your people.

Maybe you don't have inventory, equipment, or even property. Maybe you're like me and you run a service business. In that case your asset is your people. Which makes it reasonable that your excess cash should go into whatever is necessary to improve the output of this asset. Sure, technology may be be the answer. But a better answer should be knowledge. What other services can your employees provide that you're not currently offering? What things are they doing that they could be doing better? What knowledge can you help them gain that will improve the services your company is providing, thereby making you more valuable to your existing and future customers? All of this can come through better training. So take that excess cash and use it to better equip your employees with the intelligence necessary to be more profitable to your company. Send them on training courses and conferences. Get them new certifications. Raise their value. Oh, and maybe consider a better health insurance plan too. More knowledge (and a few more benefits) could turn into a substantial payoff from what anyone will tell you is the most important asset in your company.

Consider a tax-friendly investment.

OK, so maybe you're not into the above ideas. Maybe you're more comfortable parking your cash somewhere for a while. If you're going to do the investment thing, consider two options. Put your money in municipal bonds or a good 529 plan. Municipal bonds have been extremely popular over the past few years as tax rates have risen. Interest rates are normally lower than what's offered in the markets but the income is generally tax-free so your after tax return could be higher. 529 plans are a great place to put money away for your kids' college expenses as the amounts you invest will grow tax free with no withdrawal penalties as long as you use those amounts for higher education expenses, which include not only tuition but also room and board, books and a list of other items. As you know by now I'm not a big proponent of giving some other business your company's cash, but if you feel that's the right move, these are two places that may give you a better return on investment than the typical mutual fund.

I forgot to mention something else. If I kept my money in that bar-coding company I would've tripled it over the next five years. See what I mean?