I love Vangaurd's intermediate total bond fund- outstanding, low cost diversification. However, I'd only put half of my FI investments in it. The other half goes in a 5 year CD ladder, which means each year you spend 20% of your CD allocation on a new CD, then when one matures, you roll it into another (or spend a portion if necessary).CDs have different risk/return/liquidity characteristics than bond funds, and so offer another dimension of diverisification. Putting 40% of your investments in FI sounds perfect given your years to retirement, but it must be 40% of all your investments, not 40% of your IRA alone. Your FI investments belong in your IRAs, not in your taxable accounts. Nick
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