When it comes to finances, are you looking for a date or a relationship?
For a long-term secure and stable future, consider bonds.
A bond – or fixed income investment – makes a lot of sense, says Teresa Slabbaert, VP and financial consultant at Charles Schwab.
“They are more steady, certainly more than the stock market, which can be unpredictable.”
When buying a bond, you are lending money (to a government entity, for instance) and you will get interest back at a later date.
A stock is like serial dating. You can buy and sell it. You win some, lose some.
A bond is a time and money investment. Your money is committed for a specific time and you know exactly how much you will earn when it’s over – like a pre-nup.
A bond is a stable long-term relationship. They yield a more moderate return but they’re guaranteed and protect your portfolio.
However, investing in the bond market is “more complicated than the stock market,” Slabbaert admits. There are several different types of bonds. So unless you want to become an expert, Slabbaert suggests a mutual fund, which has several bonds in its portfolio.
“In a mutual fund, a professional does all the work for you. They manage the bond portfolio for you based on your financial goals.”
Resources with more information include Smart Stock Market and Schwab’s bonds research report.
With bonds in your portfolio, your money will be at little risk. And that’s a relationship worth considering.
Bonus PINK Link: Now that you know about long-term financial relationships, read our online exclusive to find out about long-term care.
Minute Mentor: SunTrust’s Ellie Sullivan discusses financial decisions to make as a couple.
Are you looking for a short or long-term financial relationship?
By Mary Welch
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