Bond Funds
I am retired and have my IRA with Vanguard. About half is in Total Stock index funds (US and international) and half in total bond market. In anticipation of the Feds cutting rates, how will this affect bond funds and what moves would you suggest. On WGN you also suggested reducing one’s weighting in stocks. Would you suggest moving a percentage to money market, treasuries, CDs, etc.? Thank you for serving our financial well-being!
Terry Says
Bond prices typically rise as interest rates fall. But if the Fed cuts rates because the economy is slowing, then company earnings — and stock prices — could fall
You have a lot of exposure to volatile investments at this stage of your life. I’d suggest about 30% in a money market fund. Yes, rates may fall. But your money will be safe and you’ll sleep well.
