Starting Out

While you may choose to remain invested completely in more growth-oriented investments at this stage of your life, you may find that fixed-income investments may help you reach some of your investment goals.

• Higher risk bonds may generate higher yields to help achieve your overall growth objective.
• If you have a short-term savings goal, you may look to fixed-income investments to help preserve your principal while still keeping your money working for you.
• If you have received an inheritance or other large sum of money, you may want to use fixed-income investments to generate living income.

Wealth Accumulation

As your nest-egg grows and you begin to earn higher levels of income, the tax-advantages of municipal bonds may serve double-duty in your portfolio by adding some stability and generating tax savings. In addition, you may be facing some relatively short-term savings goals such as college funding, or purchasing a new home, and you can use various fixed-income investments to continue to generate overall return while adding safety of principal to the funds allocated for those expenditures.

Boomer Pre-retirement

As you begin to shift from working into retirement, you will likely see your portfolio shift to favor fixed income over equities. Fixed income will provide you with added stability and downside protection that is especially important as you decide whether or not it’s time for you to retire. In addition, you are likely at the peak of your career in terms of income and the tax-advantaged features of investing in government-issued bonds may be an attractive alternative.

Retired

As you retire, you will want to maximize your income, protect your nest egg, guard against inflation and preserve your legacy. A diversified portfolio that incorporates various types of short- and long-term fixed income securities will help you achieve your goals. Government-issued securities may help lessen your income tax and high-yield securities may help your investments keep up with or ahead of inflation.