BND
Vanguard Total Bond Market
stockNASDAQETF

40% in VTIP is too much in my opinion. I’d suggest something like 15% in VTIP and 25% in BND if you want the 60/40 allocation.

I really like CAOS. The expense ratio is high, but it’s the only thing I’ve found that reliability goes up when the market goes down. Bonds don’t do that. It’s also outperformed BND since inception from selling box spreads.

Your openness to effective strategies that aren’t the norm is something I can relate to. I started planning my retirement a year and a half ago, and I really knew nothing about investment when I started. I’ve tried to stay open to new information every day over this extended learning curve and that has served me quite well. In answer to your question, all my money outside of my VT growth engine is mostly in the 20-year TIPS ladder, but also maintain a cash-like buffer of SGOV and part of my fixed income allocation is sitting in a 3-year MYGA earning 6%. The MYGA proceeds will arrive in 2029, and I’ll be free to direct those proceeds in whichever direction makes sense given market conditions and my spending needs at that time. They could go to VTIP, BND, another MYGA, more individual TIPS, SGOV or even equities. Oh and I should say there’s another large fixed jncome component to my plan. I own an income annuity that of course doesn’t adjust for inflation (boo) but it does offer some longevity risk protection (yay) and the way FIAs with income riders handle taxation means that I’ll see very little tax burden on that income for about the first 12 years after that income starts next year (double yay). That high level of tax free income makes sequence of returns risk a little smaller. You might be getting the idea that every dollar has a job to do in my plan, and the vehicles I’ve chosen make that diversity of duties possible. When I was just sitting on BND and even VTIP I did not have this level of clarity about the exact role of those positions in my plan.

I was one of those people who defaulted to a TIPS fund (VTIP) in addition to holding BND, and it was definitely a choice to favor simple over optimal. But then I saw how easy it was to at least build a ladder from 2029 to 2036 with ishares ibonds TIPS maturity ETFs. I started my ladder with those ETFs, and I willingly accepted the ER fee drag in exchange for the convenience of the ETF wrapper. *Then* I learned how easy it was to actually do the real deal and build a ladder with actual individual TIPS bonds using the free web tool tipsladder.com. Once I understood how that tool worked — it’s dead simple — I built out the remaining 12 years of my ladder using individual bonds. Now I share knowledge the tipsladder.com with people often in the hopes that they won’t need to travel the same journey that I traveled and instead just cut to the chase and build their ladders with individual bonds.

On the accounts to prioritize, my general advice is to follow the financial order of operations. I like the Money Guy framing of it, but you can also find on a few Reddit sub wikis too. FOO explains which accounts to prioritize to maximize tax efficiency. For you, this will almost certainly mean filling in your Roth IRA and putting the remainder of your extra dollars into the 403b. As for the investment options, the general advice on this sub is VT (which is combo of US and international stock market) and BND (bond etf). At your age, you don’t need a high bond allocation, \~10%.

Always wise to wait for secondary confirmation. Most of those stocks swung back on Friday (only slightly on NVDA and META, though), which is fairly typical after a large shellacking in the market. The Anthropic IPO on the 15th is the day you should really circle on your calendar. If Anthropic goes public and flops, then the *real* dip begins. And NVDA may not be as insulated as you think. OpenAI, CRWV, and Anthropic are pretty much NVDA's biggest customers right now, and all four are basically in the world's greatest drum circle. A bad Anthropic IPO means it turns into the end of John Wick 4. NVDA won't go bankrupt, but it'll definitely have a big scar after it's over, especially if AMD or another semiconductor company decides it's going to chase the market NVDA left behind. As for me? I won't be buying the dip come Monday. I'm reinforcing my shares in BND. If there is a dip, bonds are gonna skyrocket.

I agree. I prefer the TDF for the automatic allocation adjustments. VT or VT/BND works well provided you can resist “tinkering” with your portfolio, which I was guilty of myself for many years.

I second the idea of MYGAs as I’m currently sitting on a 3-year MYGA at 6%. I’ll add that TIPS are an excellent replacement for regular bond funds. I’ve got a 20-year TIPS ladder and I didn’t shed a tear when I jettisoned BND to fund the MYGA and the TIPS ladder.

A TDF is a perfectly reasonable one-fund solution. VT is probably a reasonable one-fund portfolio, assuming you have the risk tolerance for 100% stocks. If not (which is fair for 47) either add BND to VT, or just stick with the TDF.

3 is probably a good starting point for most you could debate BND or SGOV for the last spot. Or SCHD for those with a longer time horizion.

It depends on what your needs and goals are. I have very specific needs. I’m able to meet my goals. For someone else, specifically copying what I do doesn’t make sense. My point is to show options. Comparing short term, like VBIL/sgov to short term treasuries shows that you have to pay a small expense ratio. I’d rather keep that however small it is. On the longer end, comparing something like BND and the bonds I bought, I’m getting a better result, results are a bit harder to calculate. I’m fine with doing the management of my bonds to get a better result. Some people aren’t, and there is nothing wrong with that. I’m just trying to save a few bucks and meet my goals, and it’s working so far.

If I had it to do all over again without incurring capital gains, I'd do a third each in VTI (total us stock market), VXUS (total international), and BND (total bond). Granted, it's not *much* more complicated but I've moved in and out of various funds doing tax loss harvesting over the years.

There are many options for you since you have 30+ years ahead of you. Take a look at few of the options on this page: https://plainandsimpleinvesting.com/PortfolioByAge#age-20s. There are many 3 ETF portfolio you can use to your advantage. Here is just one option for you: |**ETF**|**Ticker**|**Allocation**|**\~Ann. Return**|**Expense Ratio**| |:-|:-|:-|:-|:-| |Vanguard Total Stock Market|**VTI**|**60%**|\~10.5%|0.03%| |Vanguard Total International Stock|**VXUS**|**30%**|\~5.0%|0.07%| |Vanguard Total Bond Market|**BND**|**10%**|\~3.5%\*|0.03%|

I do VOO, VEA, VWO, BND and SCHD

I put little faith in that backtest. The backtest is counterfactual. It's assuming investing in catastrophe bonds before they were actually available to retail investors \*and\* assuming investing in a broadly diversified catastrophe bond portfolio \*and\* assuming that nothing would have changed historically if access to catastrophe bonds were broadly available. The only retail investor available catastrophe bonds I'm aware of is through the ILS ETF, which is only a year old, and only has a portfolio of \~150 catastrophe bonds (ie, not the entire market). It also has a 1.58% expense ratio that won't be in the simulated catastrophe bond index. This is not to say that ILS is a bad investment, it's just not the one you back-tested. Individual catastrophe bonds are essentially impossible for retail investors to buy, so that's not an option either. That said, I don't have a problem with investing in catastrophe bonds provided you know what you're getting into. The cost of the lack of correlation is that the downside risk is harder to define. At least with corporate bonds, there are credit ratings that give some sort of indication of default risk. For catastrophe bonds, people pricing the bonds are essentially making guesses about the weather - that's much harder to predict. Certainly there's a price premium to that uncertainty, but it also means that your "much less volatile than BND" is really more like "pricing of natural disasters has been more or less accurate". If you think that will continue into the future (which I don't think is impossible!), you're making a good choice - at least assuming the market doesn't start to reduce that risk premium and result in you ending up with lower returns. However, if a large scale natural disaster happens, the downside risk is also \*radically\* more than other bonds.

I recently came across a video on YT discussing CAT bonds, also called Catastrophe bonds. They are essentially high-yield, risk-linked securities that allow insurance and reinsurance companies to transfer the financial risk of major natural disasters to capital market investors. They pay out dividends like normal bonds, but at higher rates due to the risk. The premise makes me a little nervous given climate change and how the natural disasters are getting stronger and more prevalent, however backtesting shows them as much less volatile than BND. [https://testfol.io/?s=hKxHYNzSAaa](https://testfol.io/?s=hKxHYNzSAaa) I am looking to construct a portfolio for a 5 year purchase, and to me CAT bonds feel like a very smart investment with that goal in mind. Any opinions on this asset class?

I would say option 2, as having bonds in a taxable creates a tax drag on income produced. I would sell the bonds from brokerage and buy something in retirement accounts. I do not hold BND or BNDW. I’m in Fidelity and chose a split between FIPDX and FXNAX. I am 58 and retired, with 15% of total portfolio in bonds, and 5% in cash equivalents. So, my situation is different than your dad’s.

Yes, I think there was a big buy in yesterday, which pushed rates down. I just see it as something that will not lose money, unlike BND. Rates can go up or down. Neither will have much effect on SGOV/VBIL, other than changing the payout. I don't expect these to compensate for when chip stocks crash, merely hold. I have strongly considered at least 10k of Ibonds, 10- and 30-year treasuries when above 5%.

If you're actually looking to invest and snowball over time like the others are recommending, especially at your age ... yes. VOO. Or VTI. Or QQQ if you believe in tech long-term (or QQQM, which is more aggressive, since you're younger and more risk tolerant). Or really? Honestly? Open a Roth IRA. Max it out annually (If you get a 401k, contribute to the match first, then max the Roth). Do a good 65% split among VTI (or VOO) and QQQ (or QQQM), 5% BND, 15% O (or some other REIT), & 15% on VXUS. That way, you get the S&P500 or total US market, tech exposure (well, heavier. The s&p is already heavy big tech), some real estate exposure, and foreign market exposure. It's boring. But it's a gold standard and you can rebalance it over time as you age. Any other disposable funds you have, after securing an emergency fund to cover core expenses for a few months, go research some companies and see what you like and what's worth it. Not just pump-n-dump reddit bullshit. Or do that. Idk I'm not your dad lol. But the other stuff first.