I originally was planning on visiting the capital, Managua; but decided to go a bit smaller, and nearer to the lake. So, I went to Granada. This turned out to be a great call.
This is a cute little town, with wonderful architecture. The first day, you need to just walk around the center of town, especially the cathedral and square.
Then, take an adventure on the lake, and another adventure out to the volcanoes.
16th Century lakeside town featuring neo-classical architecture.
Centered on Parque Central de Granada, just grab some ice cream and walk around. Check out the Immaculate Conception of Mary Church, the Chocolate museum, and the numerous and popular parks throughout the city.
When you are ready for adventure, head out on the lake for some boating, fishing, or kayaking.
Masaya Volcano is just a half hour south of Managua, or a half hour west of Granada, this active volcano is quite a sight to see at night.
Mombacho Volcano is just south of Granada. It is fun to be in a place where you can see more than one volcano in a single trip.