Do This to Most Effectively Use Bonds in Your Retirement Portfolio

Learn how you can use bonds most effectively in your retirement portfolio. A retirement portfolio should have bonds for extremely intentional reasons: income, uncorrelated asset class, reduced volatility.

It's not enough to stop there.

How does this impact your overall retirement plan?

Timestamps
00:00 - Introduction
2:15 - Bond Overview
3:52 - Interest Rate Risk
6:25 - Bond Prices & Supply
9:45 - US Treasury Bond Exposure
12:25 - Short-Term Buckets
13:45 - Breakeven Points
14:10 - Working With Us

Learn the tips & strategies to get the most out of life with your money.

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[janethunt]

Thank you, James. This was a great explanation to help us understand what we need to know as investors.

[gabesmith]

Subscribed- you have great info and a great style, I really enjoy the videos!

[dbest]

Thanks for tips info in 2022, Happy New year 2023!

[davidatkinson]

Great, informative video. Thank you and Happy New Year!

[Level-xd]

I wouldn’t blindly own a certain percentage of bonds in my portfolio. I would keep a certain amount in CDs to cover expenses over 3 years and the rest in 3-10 year intermediate laddered bond etfs to cover expenses for another 7 years. The rest of my portfolio would be invested in equities for growth. The overall percentage of bonds in the portfolio could vary from 20%-40% over time depending on the portfolio size.

[ferchanguitoable]

I just found your video today and it is amazing! I already subscribed, liked and set notifications to all your videos. I don’t currently own any bonds because I am 36 years old and don’t panic with current volatility due to my investment horizon. but I am planning to start adding 1% each year of a long term treasury bond index fund when I turn 45 and rebalance as needed to keep my target allocation that year. I hope in retirement, age 65, to be 80% stocks / 20% long term treasuries bond for my asset allocation.

[ilsevanheerden]

Thanks James, you have a talent for breaking things down so we can all understand it. What do you think of EUN3 as a bond ETF for Europeans? Or where do I find the Accumulating equivalent, any idea?

[dforrest]

Could you make a video about the order in which a company that goes bankrupt pays people? For example, are bond holders paid before preferred stock holders who are paid before common stock holders?

[chessdad]

I parked a bit of my winnings in VTIP. Won't be there forever, but pays a nice dividend.

[paulhi]

James, do you actually oversee the investments of your clients, or is that handed off to another entity?

[reddragon]

I understand when interest rates go up the price of the bond goes down. Can you speak to the opposite? If buying long-term bonds at 4-5 percent when the Fed pivots won't the value of the bond go up> cant find any info on the math of it if the rates go down 100bp etc and I lock in a 10-year treasury. Great channel.

[davidfolts]

Groucho Marx lost a significant amount in the stock market crash of 1929. When he told his friends he was invested in bonds, they told him he could not make much money investing in bonds. His reply? You can when you own enough of them.😮

[voodootrois]

I feel that an attitude of relying on *interest* from bond funds for living expenses is very problematic. You have to chase yield and increase duration when market interest rates fall. Then your principal takes a big hit when interest rates rise again.

[tcbridges]

What is the difference between bonds and CD’s. I keep buying one year CDs because I am getting 3.85% on $300K in one year cd’s I have a 401K but wouldn’t put this cash in there because I already paid taxes on it. I get confused

[sammyalabamy]

I love me my BONDS....now and in the future

[onlywenilaugh]

IN a target fund with 40%+ bonds, I'm trying to figure out how to fix this. Should I move my target to my own investments and take initial hit on bonds or just leave it in the target fund of 2025? I tend to think it's heavy on bonds even though I want to retire in the next couple of years.

[jhaed]

I am confused… I-bonds are giving 6.89% interest rate right now and was at 9.62% prior to that (May-October 2022). Is this a bad basket for investment?

[jdavis]

Bonds have been underwater for almost 11 years.

[nickfifield]

Do you mean bonds or bond funds - they are very different.