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Yes, the argument against a bond fund whose main risk is interest rate risk is that you may have to sell shares at less than what your paid for them. (With a fund with refinancing, call, or default risk, there are other issues.)

From an income generating perspective, something like an Intermediate Bond Index Fund (not mortgage bonds) will probably come out around the same over the long run as a ladder of CDs and/or a mix of Treasury/Investment Grade Corporates. (Although, it has consistently been possible for the last several years to find CDs that are better, because they have their own supply and demand to worry about.) So, if you never need the principal, you are probably fine with a fund, and you can let your heirs worry about selling shares for a loss. (This is how Bruce feels.)

Thanks, thanks a lot for the help.
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