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Bonds for 60-somethings
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March 30, 2000: 11:27 a.m. ET
Expert says bonds or bond funds will generate income and boost savings
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NEW YORK (CNNfn) - If you've come in to some money and you're in your 60s, you might not know what to do with the new cash to help build your savings.
In response to a reader's question, Marc Collier, a certified financial planner from Wellesley, Mass., and a member of the Certified Financial Association, said bonds or bond funds are a good option.
Ask the expert a question.
We received $120,000 recently and would like to invest it in something better than a savings account. We are both 60 years old and on Social Security Disability. We would like this money to generate an income and build our savings. We don't know how to invest this amount of money. Any suggestions as where to start are greatly needed!
Assuming you are somewhat risk-averse, my suggestion would be to consider either individual bonds and/or bond mutual funds. You can also consider income and equity-income funds, but they could carry more risk. Bond mutual funds would be easier to find and buy. You can select one that is safe and has an income you are happy with. You can ask the fund company to distribute out your dividends to you each month. If you can find a fund you like, look for one that has no sales charge and low expenses, such as Vanguard group. Or you can find a certified financial planner on the FPA Web site.
As far as individual bonds are concerned, you may purchase Treasury Bonds, high-grade corporate bonds or even municipal bonds, if you are in a high tax-bracket. You should ladder your portfolio of bonds, which simply means buying a few bonds with varying maturity dates. This prevents being invested at one particular interest rate if rates should rise on newer bonds. Some of your bonds will mature sooner and you can reinvest that money in a new, higher- interest paying bond. 
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