No. of Recommendations: 0
By now, you’ve probably read articles on the decline of family net-worth. (If not, here’s a link to a typical one. You should be shocked by the numbers. But if you dig into the underlying Federal Reserve study that the articles are cribbing from and commenting on, you will be even more shocked. In particular, look at Table 6, whose guts I’ve summarized below:
Who Owns What?

Income Savings
Percentile CDs Bonds Bonds Stocks Mutual Funds

<20 9.4 3.6 * 5.5 3.4
20-40 12.7 8.4 * 7.8 4.6
40-60 15.5 15.2 * 14.0 7.1
60-80 19.3 20.9 1.4 23.2 14.6
80-90 19.9 26.2 1.8 30.5 18.9
90-100 27.7 26.1 8.9 47.5 35.5

If their data can be trusted, the necessary conclusion is that very few people own individual bonds, which I find totally incomprehensible. Bond-investing is an easy, easy gig that pays decent money. There’s a tiny bit of vocab to be learned, and you’ve gotta be able to do at least rudimentary, financial-statement analysis if you're buying corporates or munis. But if you can buy bell peppers or broccoli, you can buy bonds, and do so responsibly. The process is no different: Inspect, and then accept or reject and move on.
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