Are You LOSING Money in Bonds? DO THIS INSTEAD...

[@matthew49310]

I don't understand the advantage to buying a one year targeted treasury ibond ETF over just buying a one year treasury bill (or buying such an ETF of any targeted maturity compared to just buying a treasury bill or note of that same maturity).

[@SafeguardWealthManagement]

With treasuries, the advantage isn't as notable. When you start moving down the line further to high yield and you have greater default risk, owning a basket of bonds is extremely important.

[@matthew49310]

@@SafeguardWealthManagement That makes sense. Thank you.

[@joesawyer931]

I'm so glad I use Safeguard as my wealth manager so I don't have to worry about any of this :)

[@tylerklepek4716]

I have always found your content to be excellent. So far, one of the best if not the best. How do you address rebalancing and liquidity? That is the tough part to me. You can negate interest rate risk with laddering but at the cost of liquidity. I am always learning.

[@SafeguardWealthManagement]

Thank you so much! Can you expand a bit on your question with an example? I just want to make sure I understand fully before answering.

[@tylerklepek4716]

@@SafeguardWealthManagement sure! This is a more diversified laddering strategy. If I have a 1,000,000 portfolio. Using the classic 60/40. I don’t want to sell stocks if they are down. I may even want to rebalance if prices are cheap. I also may not want to sell the laddered portion of my portfolio before maturity if I need liquidity as I may lock losses. This is a very innovative strategy! Just trying to wrap my head on how you would approach liquidity or rebalancing. Keep up with the content! Really good stuff!

[@paulsackles1329]

Great work Eric, thanks

[@SafeguardWealthManagement]

Thank you!

[@SnowFish-kk6ut]

For the record, High Yield bonds are called "Junk Bonds" for a reason!

[@paulr1]

Maybe just the time to buy bond etf now because they are cheap ? What do you think .

[@SafeguardWealthManagement]

Certainly the yield to maturities have become a bit more attractive. I'd still be weary of buying a normal bond fund but individual bonds or target date bonds can have a bit more safety (+ upside)

[@alphamale2363]

It's so simple to make a ladder of brokered CD's I see no compelling need to mess with these new fangled financial products.

[@bfrock01]

I was thinkin the same thing Alpha. However, some advantages I do see is greater diversification (especially in the corp/high yield category). Also, the spread and lack of liquidity on some of the individual bonds can be overcome w/ these investments.

[@bluesky2145]

I just called Black Rock about these i bonds to ask what the minimum investment was and they said I have to call a broker that they don't sell them directly and they don't know what the minimum is that depends on the broker. They also don't have a list of which brokers carry them which I found kind of odd. They don't make it easy.

[@SafeguardWealthManagement]

They are traded openly in the same way most ETFs are. Custodians do vary which is why they gave you the run around but for most of the large custodians (Schwab, TD, Fidelity, etc.) you can buy right off the exchange. For instance, IBDO the 2023 Term Treasury ETF is trading at a bit over $25 per share.

[@peaceful4you408]

There’s a company called Wealthfront that has just released their new bond ladder program. I just signed up for it. I put $5000 in it but they let you put any amount you want.

[@honestnewsnet]

Sounds redundant to me.

[@honestnewsnet]

1 Timothy 6:17 KJVS Charge them that are rich in this world, that they be not highminded, nor trust in uncertain riches, but in the living God, who giveth us richly all things to enjoy;