If capital protection is a priority - keep it in FD (assuming it's below the limit of PIDM's insurance yar).

If it's a mix of returns and willing to risk a bit, personally i'd do like 50%/50% bond funds & FDs OR 66%+/- bond funds, 33%+/- FD
Current money market returns is akin to FD BUT U lose 0.25% straight off (if Public Mutual lar). Thus, waffor?
I may be mistaken on the cost of entry for MM fund though - better check with Public Mutual's website and the MM prospectus 

Huh? U have enough lump sum for mutual funds (minimum $1K) but not enough for FD? 
Sorry - some message/idea lost in between?
OR U mean some banks dont bother with $1K for 2 year's term of FD?

If U plan to save monthly around $1K, U can stagger it into FD mar
eg
Now U have $1K, put it in for 3mths' or more tier. I'm sure they accept $1K for shorter term FD
Do the same monthly with your savings until U've enough to do longer term FD lar
Simple enough?