Comments on: When Is The Best Time to Buy Bonds?

By: Ron

Ron — Wed, 31 Aug 2011 17:41:25 +0000

Look at I bonds they are bonds that keep up with inflation. Currently 4.6% but changes rates every 6 months. Due to change again Nov.1st. Buy them at any bank at no cost. You will not be able to buy these at the banks after January 2012. They will then be available on line.

By: Vern Trahan

Vern Trahan — Sat, 21 Nov 2009 03:42:10 +0000

I want to buy some bonds for my Ira next year and wondered if I need to worry about interest rates when buying if I use a etf such as vangaurds BND to hold for 12 years.Thankyou for any advice.

By: Pinyo

Pinyo — Fri, 27 Feb 2009 03:58:31 +0000

@Bill – It’s the other way around. “120 – age rule” means that if you’re 20 years old, 100% of your investment should be in stocks, and if you’re 40 then 80% in stocks/20% in bonds, etc.

By: Bill

Bill — Fri, 27 Feb 2009 03:37:57 +0000

“120 -age rule.” so, if I’m twenty, I should be 100% in bonds, then, when I near retirement, my percentage of bonds should go down and down and down???? I don’t think so.

Can somebody quote this rule in a way that makes sense?

By: Pinyo

Pinyo — Mon, 05 Jan 2009 21:10:06 +0000

@Matt SF — You’re right. The “120 – Age rule” is the updated version.

@Vilkri — Like Matt said…scary.

By: ctreit

ctreit — Wed, 10 Dec 2008 16:01:24 +0000

In my mind a bunch of different things matter when you allocate your investments to bonds and other investments. Risk tolerance is one of the most important factors, but so is the time left until you want to reap the benefits of your investments. As for bonds, a very important element of bond investing is the income you get from bonds. When that income turns very low (as interest rates go lower right now) I wonder how investors expect to tap into the income bonds are supposed to generate. If rates hit close to zero, it does not sound like much of an income to me. Besides, the value of the bond can’t get any higher when interest rates are at zero.

By: Miranda

Miranda — Wed, 10 Dec 2008 12:35:28 +0000

Thanks for this great primer. I especially like the focus on risk tolerance. Investing is a personal thing, and you should make decisions based on what’s best for you — and what you can handle in terms of risk.

By: Matt SF

Matt SF — Wed, 10 Dec 2008 05:43:51 +0000

The age to bonds ratio is somewhat outdated to say the least. Considering that most people are living longer and healthcare is so expensive, some financial planners suggest to use a number like 120 minus your current age to set your bond percentage allocation.

As far as best time to buy bonds, it’s certainly not now. The Treasury did another bond issue today that sold at 0.0001% or something extremely minuscule. Scary times.