Balancing our portfolio w bonds?
Our (husband and I) portfolio is 34% stock and balance in fixed income (bonds, ETFs, stock). We are 75. Should we be reducing the percentage of stock due to the current market, and if so, to what?
Terry Says
You should be reducing the portion in BONDS – -now! We haven’t seen the hit that is coming in bonds, due to the economic recession. Please read the recent column I wrote called Beware of Bonds. Many bond funds have Triple B (BBB) rated bonds in them to boost yields. Those are at risk of being downgraded, which would force the funds to sell them.
The next big hit is coming in the bond market. So don’t focus on what you lost in stocks. Be prepared for losses in bonds. The alternative: Money Market mutual funds — those MM funds using government-only securities.
