A practical how-to guide for every investor. For ordinary investors who want to build an all-weather portfolio. It is time-proven wisdom, and encourages you to take control of your finances. Learn how to use CDs, bonds, and bond funds to manage risk/reward even during low interest rates. You will learn:
How to choose your stocks/bonds allocation
How to become immune to changing interest rates
When to use CDs and individual bonds
How to choose a good bond fund
How to hedge against unexpected inflation
Contents: Foreword by Larry Swedroe
- Who Should Read This Book?
- Start with a Sound Financial Lifestyle
Why Bother With Bonds?
- Stocks are risky in the short-run, and the long run too!
- Bonds Make Risk More Palatable
- Bonds Can Be A Safe Bet
- Bonds Are An Attractive Investment Diversifier
Life Is Complicated. Bonds Are Not.
- What is a Money Market Fund?
- Are CDs Better Than Bonds?
- What Are Bonds?
- What is a Bond Ladder?
- Individual Bonds or a Bond Fund?
Bonds: Risks and Returns
- Yield, Price And Making Comparisons
-- How To Compare Individual Bond Returns
-- How to Compare Bond Fund Returns
-- Total Return: To Measure And Compare Performance
- How To Reduce Risk From Interest Rates Changes
-- Duration: The Point of Indifference to Interest Rates
-- Duration: The Measure of Sensitivity to Interest Rates
- How To Reduce Risk From Unexpected Inflation
-- Real versus Nominal Interest Rates
-- Why Include TIPS In Your Portfolio?
- Credit Quality or Default Risk
Build The Bond Portion Of Your Portfolio
- Start With Your Goals.
- How Much Risk Is Right For You?
-- Understand How Much Risk You're Taking
-- Take Your Risk In Stock Market, Not Bond Market
-- How Much in Bonds? How Much in Stocks?
-- Your Needs Change Over Time
- The Importance of Low Cost
-- How Much To Diversify Bonds?
-- The Importance of Low Cost
-- Five Low-Cost Strategies You Can Do Yourself
- Taxes Matter
- Example Portfolios (both good and bad)
Common Misconceptions Important to Correct
- Stocks Are Safer In The Long Run
- Holding a Bond (or CD) to Maturity Eliminates Risk
- Stocks Are Safer Than Bonds
- The Best Funds Have The Most Stars
- A One Percent Fee Is Small
- Rising Interest Rates are Bad for Bond Holders
- You Can't Beat the Market Using Index Funds
- Use Multiple Investment Companies To Diversify
- You Need Many Mutual Funds to Diversify
- Frugal Means Stingy
Reviews Worth Noting: "[As] stocks have surged and bond yields have dwindled, investors increasingly ask "Why bother with bonds?" Rick Van Ness takes this question and runs with it in his book sporting this provocative title. Sooner or later, this question will answer itself, and it will behoove all investors to get to know Rick before it does. Read it, enjoy it, and profit from it--before it's too late."
William J. Bernstein
Author, The Four Pillars of Investing
"In his simply stated and entertaining book, Rick Van Ness eloquently instructs the reader on how to do bonds right - in fact, better than any single book I've read."
Allan S. Roth
Author: How a Second Grader Beats Wall Street
"If you are a DIY investor . . . you should read this book. It will steer you clear of areas you need to avoid and into where you should be. A quick read filled with valuable info!"
"This book should be part of America's high school curriculum."
Author: Millionaire Teacher
Rick Van Ness
Most Helpful Customer Reviews
I was able to download this book for free in Kindle when it went on sale last week. I gave it four stars because most of the beginners in investing WILL benefit from it. Note that I used WILL instead of CAN. There are certain simple things that most investors ignore and this book shines light on them. For example, How impactful is a 1% management fee? Rising interest rates is not end of the world for those who want to invest in bonds. Bonds play a vital role in your behavior in addition to providing a ballast for your portfolio. Keeping it simple makes you stick with a plan.
However, I would give this only three stars if you are an advanced investor. Some of the complaints I have on this book are as follows: 1. This book should have spent some time discussing IBonds rather than a simple reference to Bogleheads Wiki.
2. I found the reference to Norstad.org article on how risk in stocks increases with time (rather than the popular...
I received a free copy of this book to review.
I read the book cover-to-cover on my Kindle. I found it an easy to read and very informative book on bond investing. I found myself agreeing with all of the author's recommendations.
Since the author is a fan of the Boglehead Online Forum, and so am I, it is not surprising that I agree with all of his recommendations.
Bond investing is a pretty "dry" topic, but the author did a good job of keeping it interesting. Bonds are not popular in this low interest rate environment, but they are essential in a portfolio to moderate risk.
A good book for beginners and intermediate knowledge investors.
Rick Van Ness’s book Why Bother with Bonds is a must read for everyone. Rick gives down-to-earth explanations for why it’s important to own bonds, describes different bond types, bond ladders, and other seemingly confusing topics. I’ve read many books and articles on stocks, but have never come across a book that effectively explains WHY bonds are important in your portfolio. CD & Bond ladders were new to me – select them for specific target dates (e.g. down payment on a house). As a visual person, I appreciate the many graphs and images to demonstrate Rick’s explanations. The main points of each chapter are summarized. There are sample portfolios toward the end of the book that help tie everything together. As a side note, Rick is unbiased, transparent, and not-for-profit. His website FinancingLife.org has many short tutorial videos and all profits go to supporting his website and make his videos – they are worth your time!
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