To keep up with changing times in the financial markets, some income-conscious investors are changing their timing.

With interest rates falling, they are starting to look beyond short-term money market investments toward longer-time choices such as government bonds as they seek the greatest possible return on their savings.And in so doing they are getting a taste of dealing with what Wall Street professionals call the yield curve - a graphic representation of how current returns vary with different maturities of interest-bearing investments.

A year or so ago the yield curve was nearly flat. In other words, there wasn't much difference between the yields you could get from a three-month Treasury bill (a little more than 8 percent) and a 30-year Treasury bond (about 8.5 percent).

Now, thanks mainly to a sharp drop of late in short-term interest rates, the curve is much steeper. At recent levels, three-month bills yielded around 6 percent and 30-year bonds around 8 percent.

The significance of that seems plain enough. "Whenever the yield curve steepens, the investor has an incentive to improve current income by purchasing long-term bonds," observes the Value Line Investment Survey, the nation's largest investment advisory service.

But as Value Line and other analysts are quick to add, the decision generally isn't quite that simple.

Even in cases of investments of identical quality - obligations of the same issuer - some risks differ greatly with different maturities.

An investor's exposure to damage from inflation, for instance, is low in a short-term vehicle like a money-market mutual fund, whose yield fluctuates readily with changing market conditions. It is much higher, by contrast, in a long-term bond, whose price goes up and down with changing market conditions.

But as events of the past few months have demonstrated, short-term investments offer little protection from the risk of declining yields when interest rates fall.

In such circumstances it is better to own a bond with a fixed interest rate. This "locked in" payout means that the bond tends to increase in value as market interest rates decline.

Choosing between short and long still might look pretty simple when the trend of interest rates is as clear as it has been in the recent drop.

However, the yield curve's susceptibility to change demonstrates that rates on securities of varying maturities don't always move in unison.

History shows, says the brokerage firm of Kidder, Peabody & Co., that yields on long-term bonds, for instance, cannot be counted on to drop just because the Federal Reserve is easing credit conditions.

Indeed, it is possible for bond rates to rise even as the Fed is pushing short-term rates lower, if traders in the credit markets fear that stimulus from the Fed may be increasing the chance of revived inflationary pressures.

Twice in the past three months the central bank has lowered its discount rate, the charge it sets on loans to private financial institutions.

"Past reductions in the discount rate have not been accompanied by lower bond yields," Kidder Peabody analysts note.

"Since 1960 the Fed has initiated discount-rate cuts on seven occasions. In all but one case long bond yields have been higher three and six months after the second cut."

Where does all this lead investors today in their quest for income? From Value Line's standpoint, the yield curve still offers reason to go for longer maturities to get higher income.

"It appears that time is on the investor's side," Value Line concludes, but adds, "One note of caution is due. Markets have become very volatile.

"The investor should keep a sharp eye out for changes in the key statistics involving inflation, employment and consumer behavior to detect any changes in economic strength."