Does it make sense to allocate 10% of 401k Vanguard portfolio to bonds? I am 25 and don’t know if investing in bonds makes any sense at all for my age. TC 170k YOE 3 #investments #personalfinance
0% bonds until you literally retire at the VERY EARLIEST
Diversifying in bonds was a good idea at one point. Not any more.
I think there is a place for high yield bond funds in a portfolio. The return on investment can be competitive. Treasuries and corporate grade debt is a waste of time.
You shouldn't care about volatility unless you are actually using it, which is why you'd have bonds in a portfolio. This becomes really important in late retirement, but your not close to that
There are many videos on this topic. The only reason it can make sense to have 10-20% bonds is if you have the stomach to sell them and rebalance to buy more stocks when there is a down turn. This has been proven time and again to give some stability to a portfolio. Having said this, it is super hard to sell your bonds and buy stock as it is falling, and if you don't, as others have said it, it is a total waste.
Yeah but if you model this out you get underperformance long term. If you have a long time horizon you should allocate 100% stocks.
That only holds true for the last 20yr bull run lol
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Don’t do it, put all in stocks. You have so much time ahead of you….