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Longer term bonds will be clobbered if interest rates go up; you need to research just what types of bonds your mutual funds own.

Here is some info on bond risks;

https://retirementplans.vanguard.com/VGApp/pe/pubeducation/i...

I am not sure if you can get them in a 529 but for money that won’t be needed for at least five years; i-bonds have some education tax advantages and currently have a decent yield.

http://www.treasurydirect.gov/indiv/research/indepth/ibonds/...

TIPs can also be used to preserve the purchasing power but you need to understand how they are taxed if they are in a taxable account.

http://www.treasurydirect.gov/indiv/research/indepth/tips/re...

Greg
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