Many personal financial
advisors recommend that investors maintain a diversified investment
portfolio consisting of bonds, stocks and cash in varying
percentages, depending upon individual circumstances and objectives.
Because bonds typically have a predictable stream of payments and
repayment of principal, many people invest in them to preserve and
increase their capital or to receive dependable interest income.
Whatever the purpose—saving for your children’s college education or
a new home, increasing retirement income or any of a number of other
financial goals—investing in bonds can help you achieve your
That’s especially true
for retirement planning. During the past decade, the traditional
fixed-benefit retirement plans have increasingly been replaced by
defined contribution programs, such as 401(k) plans. Because these
plans offer greater individual freedom in selecting from a range of
investment options, investors must be increasingly self-reliant in
securing their retirement lifestyles.
The diversity of
fixed-income securities presents investors with a wide variety of
choices to tailor investments to their individual financial
objectives. Whatever your goals, your investment advisor can help
explain the numerous investment options available to help you reach
them, taking into account your income needs and tolerance for risk.