My pocket. The thing's like a tumor that keeps coming back.
Although that doesn't help you. I'd say if you were concerned about safety, keep it in a sock drawer or something. Maybe not socks because the fuzzy bits might get caught in there. Maybe undies drawer.
At home, it stays in the Drawer beside my bed. It's always in some form of case (be it the pink bubble wrap, the "flip 'n' play", or a crystal case with a soft pouch around it), and when I'm at college it's almost always in my pocket.