Too Late on Fixed-Income Allocation?

By Matthew Hougan

I'm surprised Jim Wiandt is just now considering a fixed-income allocation in his portfolio.

Jim, you must be tougher than I am. I'm eight years your junior, and I've had a small investment in bonds for some time. I know that it might cost me some incremental return, but the reduced portfolio volatility is worth it for me. What's more, I figure I'm already highly leveraged to the equity markets through my career, so the extra added cushion is particularly attractive.

I'd be interested to hear about how and why you decided now, at 40, was the time to jump into the great fixed-income market. Also, where are you looking on the fixed-income scale? We've been in an extraordinary moment in the fixed-income market, with potentially very interesting opportunities on the corporate side, but also high risks. As a newcomer to the space, where are you heading in your portfolio?

Beyond that, though, I'm mostly in line with your New Year's Resolutions. I'm not sure I'm ready to overweight emerging markets, but otherwise, I think you're mostly right on.

My key resolution on the investment front is simple: Keep investing on a monthly basis in my asset allocation mix, on both the taxable and retirement sides. I continue to think this will be looked back on as a great opportunity for long-term investments, even if the road from here to there is rocky.