No. of Recommendations: 1
Given you've divided your assets in a reasonable split among 60% stock index funds and 40% bond fund, I'd further split off from the bond allocation with an amount equal to 5 to 10 years of future income need put that into a money market fund, as security against unsettled market conditions. I prefer a short-term bond fund, or a mixture of short- and intermediate-term bond funds, for a more stable NAV, and look to the equity allocation for growth of assets. Both Wendy and Loki tend to ignore the convenience of bond funds in their zeal for CDs and individual bonds. Those require a lot more fiddling than you might want, and getting your money out can be costly if the instrument is not held to maturity.

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